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Higher second quarter income for Molson Coors

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Molson Coors Brewing Company (NYSE: TAP; TSX) today reported strong income growth for the second quarter. Net income attributable to Molson Coors increased 136.3 percent to $187.3 million for the second quarter, up from $79.4 million a year ago. Underlying after-tax income(1) increased 20.6 percent to $205.4 million, or $1.11 per diluted share, up from $170.3 million, or $0.92 per diluted share a year ago.
Peter Swinburn, Molson Coors president and chief executive officer, said “Our Company is off to a solid start in the first half of this year, reflecting the benefit of our strong brands, strategic initiatives, and cost reduction programs. In the second quarter, we again achieved positive pricing and local currency profit growth in each of our major markets, which helped offset the impact of lower volume, increased input costs and unfavorable currency movements. While we expect the balance of 2009 to present challenges in the areas of competitive price discounting in Canada and cost inflation across our company, we are addressing these issues by staying focused on building strong brands, reducing costs, generating cash, and driving shareholder value.”
Second Quarter Highlights
Key operating and financial highlights for the Company’s fiscal second quarter ended June 28, 2009, compared to the fiscal second quarter ended June 29, 2008, include the following:
—  Underlying after-tax income(1) increased 20.6 percent to $205.4      million, or $1.11 per diluted share, up from $170.3 million, or $0.92      per diluted share a year ago.  This earnings performance was driven by      increased beer pricing and substantial cost reductions across the      Company, which were partially offset by continuing unfavorable      currency movements, cost inflation, and lower worldwide volume.  —  Second quarter 2009 results include the impact of unfavorable foreign      currency movements, which decreased total underlying pretax income      approximately $21 million versus a year ago.  —  Excluding the impact of foreign currency, the Company’s underlying      income increased approximately 30 percent in the quarter.  —  Molson Coors worldwide beer volume decreased 3.2 percent on a pro      forma basis, due to poor weather in key geographies, a weak global      economy, and the Company’s strategy in the U.K. to emphasize revenue      growth over low-margin volume growth.
—  Worldwide Coors Light volume grew 3 percent from a year ago.

The Company’s effective tax rate during the second quarter 2009 for income from continuing operations was 20 percent on a reported basis, and 22 percent on an underlying basis. The Company estimates that its full-year 2009 effective tax rate will be in the range of 10 percent to 14 percent.
During the quarter, Molson Coors achieved an incremental $32 million of cost savings as part of its three-year, $250 million Resources for Growth (RFG) cost savings program. Savings from the RFG program during the past 2 1/2 years now total $229 million. These cost savings include the company’s 42 percent share of RFG cost savings that were achieved by MillerCoors, which equaled $3 million in the second quarter.
MillerCoors achieved $60 million in synergies in the second quarter, largely due to the network optimization savings realized from moving production of Coors brands into former Miller breweries, continued realization of organizational savings, and savings in marketing investment. Molson Coors’ 42 percent share of these synergies is $25 million. Year-to-date, MillerCoors has delivered $110 million in synergies, and the Company now expects to achieve $260 million of cumulative synergies by the end of calendar 2009, surpassing its original commitment of $225 million. While the timing of synergy delivery has accelerated, MillerCoors’ $500 million synergy goal is unchanged.
Molson Coors Brewing Company’s total worldwide beer volume was 13.533 million hectoliters in the quarter, 3.2 percent lower versus the prior year on a pro forma basis, as shown in Table 1 below.
Molson Coors Brewing Company  Table 1:  2009 Second Quarter Worldwide Beer Volume  (In Millions of Hectoliters)
Thirteen Weeks Ended          Thirteen Weeks Ended                   —————–             —————–                   June 28, June 29,            June 28, June 29,                     2009     2008    % Change   2009     2008     % Change                   ——– ——–   ——– ——– ——–  ——–                    Actual Pro forma(1)         Actual   Actual    Financial     Volume:         5.005   5.408      (7.5%)   5.005   13.679      (63.4%)    Royalty Volume:  0.077   0.067      14.9%    0.077    0.067       14.9%                     —–   —–               —–    —–  Owned Volume:      5.082   5.475      (7.2%)   5.082   13.746      (63.0%)    Proportionate     Share of     Equity     Investment     Sales-to-     Retail:         8.451   8.509      (0.7%)   8.451   0.099          NM                     —–   —–               —–   —–  Total Worldwide   Beer Volume:     13.533  13.984      (3.2%)  13.533  13.845        (2.3%)                    ======  ======              ======  ======  ————————————————————————–  Notes:  ——  NM = Not Meaningful  (1)  Reflects the elimination of the U.S. segment volume reported for the  13 weeks ended June 29, 2008, and the addition of Molson Coors Brewing  Company’s proportionate share of MillerCoors and Modelo Molson sales-to-  retail for the periods presented, adjusted for comparable trading days, if  applicable.
Business Segments

Following are the Company’s 2009 second quarter results by business segment:
Canada Business


Canada underlying pretax income in local currency grew 2 percent versus a year ago as a result of positive net pricing and the benefit of cost savings initiatives, which more than offset inflation impacts in the quarter. On a reported basis, Canada underlying pretax income was $137.3 million in the second quarter, 11.0 percent lower than a year ago as local currency profit growth was offset by a 13 percent, or $18 million, year-over-year decline in the Canadian dollar versus the U.S. dollar.
Canada sales-to-retail (STRs) decreased 0.5 percent in the second quarter versus last year. Strategic brands increased almost 2 percent, led by high-single-digit growth of Coors Light and solid growth by Rickard’s. Molson Canadian declined at a mid-single-digit rate versus prior year. Canada beer industry volumes increased an estimated 1.8 percent in the quarter.
Canada sales volume was 2.4 million hectoliters, down 2.9 percent versus 2008. Comparable(2) net sales per hectoliter increased 2.6 percent in local currency, driven by front-line price increases in all major markets and improved sales mix, partially offset by promotional activity across Canada.
Cost of goods sold per hectoliter increased 1.7 percent on a comparable basis in local currency, due to a 2 percent inflationary increase from commodities, packaging materials, distribution, and other input costs, and a 2 percent increase from overhead costs and ongoing product mix shifts. Savings from cost reduction initiatives more than offset inflation and reduced cost of goods sold per hectoliter by 3 percentage points.
Comparable marketing, general and administrative expenses decreased approximately 1 percent in local currency, driven by lower overhead costs.
Other income increased $3.9 million due to foreign currency gains.
United States Business (MillerCoors)(3)

Molson Coors underlying U.S. segment pretax income increased 26.5 percent to $142.7 million in the second quarter due to strong underlying income growth by MillerCoors. U.S. segment results include the Company’s 42 percent share of second quarter 2009 net income attributable to MillerCoors and various adjustments for the equity income calculation under U.S. GAAP, which are then compared to the year-earlier results reported by the legacy Coors business.
MillerCoors Operating and Financial Highlights (U.S. GAAP)


For the quarter, underlying net income attributable to MillerCoors, excluding special items, increased by 16.4 percent to $325.3 million versus the prior year pro forma quarter. This earnings growth was driven by strong net revenue growth, cost management and continued synergy delivery.
In a soft beer market, MillerCoors domestic STRs were down 0.8 percent versus the prior year pro forma quarter due to a decline in Miller Lite STRs and softness in above premium brands, mostly offset by positive results in five of the six focus brands. The six national focus brands increased STRs by 1.3 percent, led by Coors Light, MGD 64, and Keystone Light. Domestic sales-to-wholesalers (STWs) declined 1.1 percent, driven by lower STRs and a slight reduction in distributor inventories.
MillerCoors total net sales increased by 1.6 percent to $2.14 billion versus the prior pro forma quarter. Excluding contract brewing and company-owned distributor sales, net sales increased 1.7 percent to $2.00 billion. Third-party contract brewing volumes declined 6.5 percent, though profits were in line with the prior year comparable quarter.
Pricing remained strong in the second quarter as domestic net sales per hectoliter, excluding contract brewing and company-owned distributor sales, increased by 3.0 percent based on 2008 price increases.
Though MillerCoors continues to realize supply-chain-related synergies and deliver savings from its cost leadership programs, cost of goods sold per hectoliter increased by 5.1 percent due to significant prior year hops sales, as well as increased brewing and packaging material costs this year, primarily glass, aluminum and barley.
For the quarter, marketing, general and administrative costs decreased by 10.8 percent, driven primarily by synergies and other cost savings.
Depreciation and amortization expense for MillerCoors in the second quarter was approximately $72 million, and additions to tangible and intangible assets totaled $120 million.
United Kingdom Business


The U.K. business reported underlying pretax income of $36.8 million in the second quarter, an increase of $15.3 million, or 70.1 percent, versus the same quarter last year. These results include the impact of a 22 percent decline in the value of the British pound versus the U.S. dollar, which reduced underlying pretax income by approximately $10 million. In local currency, the U.K. business underlying pretax earnings were up nearly 118 percent. This solid quarterly performance was driven by positive results from the strategic actions our U.K. team has taken in the past year, including supplier negotiations leveraging our contract brewing arrangement and brand building efforts, which allowed us to forgo low-margin volume.
U.K. owned-brand volume decreased 12.4 percent during the quarter due to soft industry performance and the Company’s strategy to forgo low-margin volume. The U.K. beer industry declined approximately 5 percent in the second quarter, reflecting a weak economy in that market.
In local currency, comparable U.K. net sales per hectoliter of owned products increased 19.8 percent, approximately three-quarters driven by higher net pricing in all channels, and the balance of the increase attributable to positive sales mix.
Comparable cost of goods sold per hectoliter of owned brands was virtually unchanged in local currency in the second quarter, reflecting higher input cost inflation and fixed cost de-leverage as a result of lower volumes, offset by favorable channel mix and cost-reduction savings.
Marketing, general and administrative expense increased 10.1 percent in local currency due to higher marketing and incentive compensation expenses in the second quarter.
Global Markets Business and Corporate


The underlying pretax loss for Global Markets and Corporate was $52.1 million, a 14.6 percent reduction versus the second quarter of 2008.
The Company’s Global Markets business grew volume more than 18 percent, on a small base, driven by the strength of Coors Light in China and Carling in Europe. Marketing, general and administrative expense for Global Markets was $12.6 million in the quarter, an increase of $3.3 million versus a year ago.
Corporate general and administrative expense was $30.6 million in the second quarter, an increase of $4.7 million, driven by higher incentive compensation and project spending this year.
Corporate net interest expense was $22.0 million in the second quarter, a decrease of $7.9 million compared to a year ago, with approximately $4 million of this reduction attributable to foreign currency movements and nearly all the balance primarily due to BRI deconsolidation. In the quarter, Corporate other expense of $8.9 million was driven by a one-time mark-to-market expense related to the Foster’s cash-settled total-return swap.
Special and Other One-Time Items
During the second quarter 2009, the Company reported net special charges of $7.1 million pretax, which was composed primarily of $5.7 million of costs associated with the Cobra brand acquisition and $1.1 million of restructuring costs in the U.K.
Other one-time items in the quarter included a $12.9 million non-cash mark-to-market expense in corporate other related to the cash-settled total-return swap the Company arranged with respect to Foster’s common stock in 2008, as well as $1.0 million to establish an environmental litigation reserve.
During the second quarter of 2009, MillerCoors reported special charges totaling $20.4 million, including a charge for pension curtailment and integration expenses. This equates to $8.6 million at Molson Coors’ 42 percent economic ownership share.
These special and other one-time items have been excluded from underlying earnings in the second quarter 2009.
Discontinued Operations
The Company reports results associated with its former Brazilian unit, Cervejarias Kaiser (“Kaiser”), as discontinued operations. In the second quarter, gains from small reductions in liabilities were offset by losses from foreign exchange.
2009 Second Quarter Earnings Conference Call
Molson Coors Brewing Company will conduct an earnings conference call with financial analysts and investors at 11:00 a.m. Eastern Time today to discuss the Company’s 2009 second quarter results. The Company will provide a live webcast of the earnings call.
Approximately two hours after the conclusion of the earnings call, the Company also will host an online, real-time webcast of an Investor Relations Follow-up Session with financial analysts at 2:00 p.m. Eastern Time. Both webcasts will be accessible via the Company’s website, www.molsoncoors.com. Online replays of the webcasts will be available until 11:59 p.m. Eastern Time on November 3, 2009. The Company will also post this release and related financial statements on its website today.
Footnotes:
(1) The Company calculates non-GAAP underlying income by excluding special and other one-time items from the nearest U.S. GAAP earnings measure. To calculate underlying income in the second quarter of 2009, the Company excluded one-time expenses, particularly related to MillerCoors, the Foster’s cash-settled total-return swap, and an environmental liability reserve, as well as net special charges of $7.1 million pretax. For further details, please see the section “Special and Other One-Time Items”, along with tables for reconciliations to the nearest U.S. GAAP measures. All $ amounts are in U.S. Dollars.
(2) Except where otherwise indicated, comparable Canada results exclude the deconsolidation of Brewers Retail Inc. in Ontario on March 1, 2009, and effects of forming MillerCoors in 2008. Comparable results also exclude the year-over-year impact for beer sales to MillerCoors. With the completion of the MillerCoors joint venture, the financial impact of our brand exports to the U.S. are no longer being treated as inter-company sales and eliminated upon consolidation of total Molson Coors results. Sales volume for these U.S. exports is excluded from Canada results and is now reported by MillerCoors.
(3) MillerCoors, a U.S. joint venture of Molson Coors Brewing Company and SABMiller plc, was launched on July 1, 2008. Molson Coors has a 42 percent economic interest in MillerCoors, which is accounted for using the equity method. Molson Coors’ interest in MillerCoors results, along with certain adjustments under U.S. GAAP, are reflected in “Equity Income in MillerCoors.” Historical period results have not been reclassified to conform to this presentation, so year-over-year comparisons of consolidated and U.S. segment volume, net sales, cost of goods sold, and marketing, general and administrative results are less meaningful. For comparability, the parent companies of MillerCoors have provided a full income statement for second quarter 2009, along with pro forma results for the prior year period. This release also includes reconciliation from MillerCoors Net Income to Molson Coors Brewing Company Equity Income in MillerCoors and Non-GAAP U.S. Segment Underlying Pretax Income (see Table 5).
Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of the federal securities laws, and language indicating trends, such as “trend improvements,” “progress,” “anticipated,” “expected,” “improving sales trends” and “on track.” It also includes financial information, of which, as of the date of this press release, the Company’s independent auditors have not completed their review. Although the Company believes that the assumptions upon which the financial information and its forward-looking statements are based are reasonable, it can give no assurance that these assumptions will prove to be correct. Important factors that could cause actual results to differ materially from the Company’s projections and expectations are disclosed in the Company’s filings with the Securities and Exchange Commission. These factors include, among others, changes in consumer preferences and product trends; price discounting by major competitors; failure to realize the anticipated cost savings and other benefits from MillerCoors; failure to realize anticipated results from synergy initiatives; and increases in costs generally. All forward-looking statements in this press release are expressly qualified by such cautionary statements and by reference to the underlying assumptions. We do not undertake to update forward-looking statements, whether as a result of new information, future events or otherwise.
Reconciliations to Nearest U.S. GAAP Measures
Molson Coors Brewing Company  Table 2:  2009 Second Quarter Underlying After-Tax Income  (After-Tax Income From Continuing Operations, Excluding Special and   Other One-time Items)  (In Millions of $US, Except Per Share Data)  (Note: Some numbers may not sum due to rounding.)
2009 2nd Q   2008 2nd Q                                                    ———–  ———-  U.S. GAAP: Income from continuing   operations attributable to MCBC, net   of tax:                                              187.3        91.8  ————————————-                                    Per diluted share:  $1.01       $0.49  Add back: Pretax special   items – net                                            7.1       103.9  Add back: Environmental litigation   reserve (1)                                            1.0           –  Add back: Loss related to the cash-   settled total return swap (1)                         12.9           –  Add back: Proportionate share of   MillerCoors pretax special items –   net (2)                                                8.6           –  (Minus): Tax effects related to   special and other one-time items                     (11.5)      (25.4)  Non-GAAP: Underlying after-tax   income:                                              205.4       170.3
Per diluted share:  $1.11       $0.92  ————————————————————————-  Notes:  ——  (1) Included in Other Income (Expense)  (2) Included in Equity Income in MillerCoors, but excluded from non-GAAP  underlying pretax income.

Molson Coors Brewing Company  Table 3:  2009 Second Quarter Underlying Pretax Income  (Pretax Income From Continuing Operations, Excluding Special and Other   One-time Items)  (In Millions of $US)  (Note: Some numbers may not sum due to rounding.)
————————————  ————                                      Business                    Total                        ————————————  ————                                                   Global                                                 Markets and                        Canada    U.S.   U.K.    Corporate    Consolidated  ——————-   ——    —-   —-   ————  ————  U.S. GAAP: 2009 2nd   Q Income (loss)   from continuing   operations before   income taxes         $136.4  $134.1  $30.0         $(65.4)       $235.1  ——————-  Add back/(Minus):   Pretax special   items -net              0.9       –    6.8           (0.6)          7.1  Add back:   Environmental   litigation reserve(1)     –       –      –            1.0           1.0  Add back: Gain   related to the cash-   settled total   return swap (1)           –       –      –           12.9          12.9  Add back:   Proportionate   share of   MillerCoors   pretax special   items -net (2)            –     8.6      –              –           8.6  Non-GAAP: 2009 2nd Q   underlying pretax   income (loss)        $137.3  $142.7  $36.8         $(52.1)       $264.7  ——————–  ——  ——  —–         ——        ——  Percent change   2009 2nd Q vs.   2008 2nd Q   underlying pretax   income (loss)         -11.0%   26.5%  70.1%         -14.6%         16.3%  ——————     —–    —-   —-          —–          —-  U.S. GAAP: 2008 2nd   Q Income (loss)   from continuing   operations before   income taxes         $153.9   $35.4  $18.4         $(84.0)       $123.7  ——————-  Add back: Pretax   special items – net     0.5    77.3    3.1           23.0         103.9  Non-GAAP: 2008 2nd Q   underlying pretax   income (loss)        $154.4  $112.7  $21.5         $(61.0)       $227.6  ——————–  ——  ——  —–         ——        ——  Notes:  ——  (1) Included in Other Income (Expense)  (2) Included in Equity Income in MillerCoors, but excluded from non-GAAP  underlying pretax income.

MillerCoors LLC  Table 4:  2009 Second Quarter Underlying Net Income  (Net Income, Excluding Special Items)  (In Millions)                      Three Months Ended           Six Months Ended                  ————————— —————————                  June 30, 2009 June 30, 2008 June 30, 2009 June 30, 2008                  ————- ————- ————- ————-                                  Pro Forma                   Pro Forma  U.S. GAAP –   Net Income    attributable    to MillerCoors    LLC:               $304.9        $174.6        $510.9        $311.2   Add back:    Special    items, net           20.4         104.8          30.8         116.1                         —-         —–          —-         —–  Non-GAAP –   Underlying   net income:         $325.3        $279.4        $541.7        $427.3                       ======        ======        ======        ======

Pretax and after-tax underlying income should be viewed as a supplement to  — not a substitute for — our results of operations presented on the basis  of accounting principles generally accepted in the United States.  We  believe that underlying income performance is used by and is useful to  investors and other users of our financial statements in evaluating our  operating performance because it provides them with an additional tool to  evaluate our performance without regard to items such as special items,  which can vary substantially from company to company depending upon  accounting methods and book value of assets and capital structure.  Our  management uses underlying income as a measure of operating performance to  assist in comparing performance from period to period on a consistent  basis; as a measure for planning and forecasting overall expectations and  for evaluating actual results against such expectations; and in  communications with the board of directors, stockholders, analysts and  investors concerning our financial performance.

Molson Coors Brewing Company  Table 5:  Reconciliation of Net Income Attributable to MillerCoors to   MCBC’s Equity Income in MillerCoors and Reconciliation to U.S. Segment   Underlying Pretax Income  (In Millions)  (Note: Some numbers may not sum due to rounding.)
Thirteen Weeks   Twenty-Six Weeks                                              Ended             Ended                                          ————–   —————–                                          June 28, 2009     June 28, 2009                                          ————-     ————-    MillerCoors Net Income                     $304.9           $510.9      Multiply: MCBC economic       interest % in MillerCoors                   42%              42%                                                  —              —      MCBC proportionate share of       MillerCoors net income                  $128.1           $214.6      Add: Accounting policy       elections (1)                                –              7.3      Add: Amortization of the       difference between MCBC       contributed cost basis and       the underlying equity in net       assets of MillerCoors (2)                  3.9              6.9      Add: Share-based compensation       adjustment (3)                             2.1              2.4                                                  —              —    Equity Income in MillerCoors     (reported)                                $134.1           $231.2                                               ======           ======        Add: Proportionate share         of MillerCoors special         items (4)                                8.6             12.9        (Minus): Accounting policy         elections (1)                              –             (7.3)                                                  —             —-    U.S. Segment Underlying Pretax     Income (Non-GAAP)                         $142.7           $236.8                                               ======           ======
————————————————————————  Notes:  ——  (1) MillerCoors made its initial accounting policy elections upon  formation, impacting certain asset and liability balances.  These  adjustments reflect the impact to our investment in MillerCoors, which is  based upon our contributed assets and liabilities.  (2) MCBC’s net investment in MillerCoors is based on the carrying values  of the net assets it contributed to the joint venture.  MCBC’s investment  basis in MillerCoors is less than our underlying equity (42%) in the total  net assets of MillerCoors (contributed by both Coors and Miller) by  approximately $644 million.  This amount is being amortized over a period  of time represented primarily by the remaining useful lives of long-lived  assets giving rise to the difference.  For non-depreciable assets, such as  goodwill, no adjustment will be recorded to the MillerCoors equity method  income unless there is an impairment.  (3) The net adjustment is to record all stock-based compensation  associated with preexisting equity awards to be settled in MCBC Class B  common stock held by former CBC employees now employed by MillerCoors and  eliminate all stock-based compensation impacts related to preexisting  SABMiller equity awards held by Miller employees now employed by  MillerCoors.  The adjustment is to recognize the additional 58% of the  stock-based compensation costs associated with those awards recognized and  reported by MCBC’s U.S. business and eliminate all of the costs associated  with equity awards to be settled in SABMiller equity.  (4) MillerCoors Q2 2009 Special Items of $20.4 million, multiplied by  MCBC’s proportionate share of MillerCoors at 42%, equals $8.6 million.  MillerCoors first half of 2009 Special Items of $30.8 million, multiplied  by MCBC’s proportionate share of MillerCoors at 42%, equals $12.9 million.

Molson Coors Brewing Company and Subsidiaries  Table 6:  Condensed Consolidated Statements of Operations  (In Millions, Except Per Share Data)  (Unaudited)

Thirteen Weeks Ended  Twenty-Six Weeks Ended                     ——————–  ———————-                      June 28,   June 29,   June 28,   June 29,                        2009       2008       2009       2008                     ———  ———  ———  ———
Volume in   hectoliters          5.005     13.679      8.901     24.388                        =====     ======      =====     ======
Sales              $1,160.4   $2,359.4   $1,984.6   $4,175.6  Excise taxes         (361.5)    (602.0)    (626.7)  (1,061.6)                       ——     ——     ——   ——–    Net Sales           798.9    1,757.4    1,357.9    3,114.0  Cost of goods   sold                (432.6)  (1,033.6)    (778.7)  (1,868.6)                       ——   ——–     ——   ——–    Gross profit        366.3      723.8      579.2    1,245.4  Marketing,   general and   administrative   expenses            (230.0)    (463.2)    (412.6)    (899.8)  Special items,   net                   (7.1)    (103.9)     (17.3)    (111.2)  Equity income   in MillerCoors       134.1          –      231.2          –                        —–          –      —–          –    Operating     income             263.3      156.7      380.5      234.4  Interest   expense, net (1)     (19.9)     (27.0)     (39.8)     (54.8)  Debt   extinguishment   costs                    –          –          –      (12.4)  Other expense,   net                   (8.3)      (6.0)     (26.8)      (1.4)                         —-       —-      —–       —-    Income from     continuing     operations     before income     taxes              235.1      123.7      313.9      165.8  Income tax   expense              (47.3)     (26.5)     (46.0)     (19.9)                        —–      —–      —–      —–    Income from     continuing     operations         187.8       97.2      267.9      145.9  Loss from   discontinued   operations,   net of tax               –      (12.4)      (3.9)     (21.4)                            –      —–       —-      —–    Net income          187.8       84.8      264.0      124.5  Less: Net income   attributable to   noncontrolling   interests (2)         (0.5)      (5.4)      (1.0)     (10.8)                         —-       —-       —-      —–    Net income     attributable     to MCBC           $187.3      $79.4     $263.0     $113.7                       ======      =====     ======     ======
Basic income   (loss) per share:    From     continuing     operations     attributable     to MCBC            $1.02      $0.50      $1.45      $0.75    From     discontinued     operations     attributable     to MCBC                –      (0.07)     (0.02)     (0.12)                        —–      —–      —–      —–  Basic net   income per   share                $1.02      $0.43      $1.43      $0.63                        =====      =====      =====      =====  Diluted income   (loss) per   share:    From     continuing     operations     attributable     to MCBC            $1.01      $0.49      $1.44      $0.73    From     discontinued     operations     attributable     to MCBC                –      (0.07)     (0.02)     (0.12)                         —-      —–      —–      —–  Diluted net   income per   share                $1.01      $0.42      $1.42      $0.61                        =====      =====      =====      =====
Weighted   average   shares – basic       184.2      182.4      184.0      181.7  Weighted   average   shares –   diluted              185.4      186.0      185.2      185.0
Dividends per   share                $0.24      $0.20      $0.44      $0.36                        =====      =====      =====      =====
Amount   attributable   to MCBC    Income from     continuing     operations,     net of tax        $187.3      $91.8     $266.9     $135.1    Loss from     discontinued     operations,     net of tax             –      (12.4)      (3.9)     (21.4)                         —-      —–       —-      —–    Net income     attributable     to MCBC           $187.3      $79.4     $263.0     $113.7                       ======      =====     ======     ======
————————————————————————–  Notes:  ——  (1) On December 29, 2008, we adopted Financial Accounting Standards Board  Staff Position Accounting Principles Board 14-1, “Accounting for  Convertible Debt Instruments That May Be Settled in Cash upon Conversion  (Including Partial Cash Settlement)” (“FSP APB 14-1”).  This FSP APB 14-1  clarifies that convertible debt instruments that may be settled in cash  upon conversion, including partial cash settlement, should separately  account for the liability and equity components in a manner that will  reflect the entity’s nonconvertible debt borrowing rate when interest cost  is recognized in subsequent periods.  Upon adopting FSP APB 14-1, the  provisions were retroactively applied.  As a result, $3.9 million and $7.8  million of additional non-cash interest expense was recorded in the second  quarter and first half of 2008, respectively.  During the second quarter  and first half of 2009, we recorded $4.1 million and $8.1 million of  additional non-cash interest expense, respectively.  (2) On December 29, 2008, MCBC adopted Statement of Financial Accounting  Standards No. 160, “Noncontrolling Interests in Consolidated Financial  Statements – an amendment of ARB No. 51,” the provisions of which, among  others, require that minority interests be renamed noncontrolling  interests and that consolidated net income (loss) includes the amounts  attributable to such noncontrolling interests for all periods presented.

Molson Coors Brewing Company and Subsidiaries  Table 7:  Canada Segment Results of Operations  (In Millions)  (Unaudited)

Thirteen Weeks Ended  Twenty-Six Weeks Ended                                ——————–  ———————-                                  June 28,   June 29,   June 28,  June 29,                                    2009       2008       2009      2008                                 ———  ———  ——–  ———
Volume in hectoliters             2.402      2.475     4.165      4.242                                    =====      =====     =====      =====
Sales                            $614.3     $695.5  $1,036.1   $1,195.3  Excise taxes                     (143.3)    (162.9)   (240.4)    (279.1)                                   ——     ——    ——     ——    Net sales                       471.0      532.6     795.7      916.2  Cost of goods sold               (231.1)    (258.5)   (418.5)    (474.7)                                   ——     ——    ——     ——    Gross profit                    239.9      274.1     377.2      441.5  Marketing, general and   administrative expenses         (103.8)    (117.1)   (187.3)    (223.7)  Special items, net                 (0.9)      (0.5)     (9.0)      (1.9)                                     —-       —-      —-       —-    Operating income                135.2      156.5     180.9      215.9  Other income (expense), net         1.2       (2.6)      5.5        0.7                                      —       —-       —        —    Earnings before income taxes   $136.4     $153.9    $186.4     $216.6                                   ======     ======    ======     ======

Molson Coors Brewing Company and Subsidiaries  Table 8:  United States Segment Results of Operations  (In Millions)  (Unaudited)

Thirteen Weeks Ended  Twenty-Six Weeks Ended                                ——————–  ———————-                                  June 28,  June 29,   June 28,  June 29,                                   2009(1)    2008      2009(1)    2008                                  ——— ———  ——— ——–
Volume in hectoliters                   –     8.271          –   14.779                                        ===     =====        ===   ======
Sales                                  $-    $970.3         $- $1,721.7  Excise taxes                            –    (128.5)         –   (229.9)                                        —    ——        —   ——    Net sales                             –     841.8          –  1,491.8  Cost of goods sold                      –    (514.4)         –   (907.3)                                        —    ——        —   ——    Gross profit                          –     327.4          –    584.5  Marketing, general and   administrative expenses                –    (214.6)         –   (412.2)  Special items, net                      –     (77.3)         –    (69.3)  Equity income in MillerCoors        134.1         –      231.2        –                                      —–      —-      —–     —-    Operating income                  134.1      35.5      231.2    103.0  Other (expense) income, net             –      (0.1)         –      2.3                                        —      —-        —      —    Earnings before income taxes     $134.1     $35.4     $231.2   $105.3                                     ======     =====     ======   ======
————————————————————————-  Notes:  ——  (1)Reflects the formation of MillerCoors on July 1, 2008.  Prior periods  reflect results of the Company’s pre-existing U.S. operations.

Molson Coors Brewing Company and Subsidiaries  Table 9:  United Kingdom Segment Results of Operations  (In Millions)  (Unaudited)

Thirteen Weeks Ended  Twenty-Six Weeks Ended                                ——————–  ———————-                                  June 28,  June 29,   June 28,   June 29,                                    2009      2008       2009       2008                                  ——–  ———  ———  ——–
Volume in hectoliters              2.475      2.824      4.496     5.170                                     =====      =====      =====     =====
Sales                             $526.1     $676.1     $912.4  $1,227.4  Excise taxes                      (216.4)    (309.0)    (383.3)   (549.8)                                    ——     ——     ——    ——    Net sales                        309.7      367.1      529.1     677.6  Cost of goods sold                (191.5)    (251.6)    (341.4)   (470.6)                                    ——     ——     ——    ——    Gross profit                     118.2      115.5      187.7     207.0  Marketing, general and   administrative expenses           (82.9)     (96.4)    (149.9)   (191.5)  Special items, net                  (6.8)      (3.1)      (7.7)     (5.2)                                      —-       —-       —-      —-    Operating income                  28.5       16.0       30.1      10.3  Interest income, net                 2.1        2.9        4.1       5.7  Other expense, net                  (0.6)      (0.5)      (1.6)     (1.7)                                      —-       —-       —-      —-    Earnings before income taxes     $30.0      $18.4      $32.6     $14.3                                     =====      =====      =====     =====

Molson Coors Brewing Company and Subsidiaries  Table 10:  Global Markets and Corporate Results of Operations  (In Millions)  (Unaudited)

Thirteen Weeks Ended  Twenty-Six Weeks Ended                                ——————–  ———————-                                  June 28,   June 29,  June 28,   June 29,                                     2009       2008      2009       2008                                   ——–   ——— ——–   ———
Volume in hectoliters              0.128      0.109     0.240      0.197                                     =====      =====     =====      =====
Sales                              $20.0      $17.6     $36.1      $31.3  Excise taxes                        (1.8)      (1.7)     (3.0)      (2.9)                                      —-       —-      —-       —-  Net sales                           18.2       15.9      33.1       28.4  Cost of goods sold                 (10.0)      (9.1)    (18.8)     (16.0)                                     —–       —-     —–      —–    Gross profit                       8.2        6.8      14.3       12.4  Marketing, general and   administrative expenses           (43.3)     (35.1)    (75.4)     (72.4)  Special items, net                   0.6      (23.0)     (0.6)     (34.8)                                       —      —–      —-      —–    Operating loss                   (34.5)     (51.3)    (61.7)     (94.8)  Interest expense, net              (22.0)     (29.9)    (43.9)     (60.5)  Debt extinguishment costs              –          –         –      (12.4)  Other expense, net                  (8.9)      (2.8)    (30.7)      (2.7)                                      —-       —-     —–       —-    Loss before income taxes        $(65.4)    $(84.0)  $(136.3)   $(170.4)                                    ======     ======   =======    =======

MillerCoors LLC (1)  Table 11:  Results of Operations  (In Millions)  (Unaudited)
Three Months Ended     Six Months Ended                               ——————–  ——————–                                June 30,   June 30,   June 30,   June 30,                                  2009       2008       2009       2008                               ———  ———  ———  ———                                 Actual   Pro Forma    Actual   Pro Forma
Volume in hectoliters           22.938     23.326     41.360     42.117                                  ======     ======     ======     ======
Sales                         $2,499.4   $2,469.7   $4,505.1   $4,416.8  Excise taxes                    (362.7)    (365.7)    (652.5)    (660.4)                                  ——     ——     ——     ——    Net sales                    2,136.7    2,104.0    3,852.6    3,756.4  Cost of goods sold            (1,302.3)  (1,259.8)  (2,352.2)  (2,276.8)                                ——–   ——–   ——–   ——–    Gross profit                   834.4      844.2    1,500.4    1,479.6  Marketing, general and   administrative expenses        (500.6)    (561.2)    (942.4)  (1,047.1)  Special items, net               (20.4)    (104.8)     (30.8)    (116.1)                                   —–     ——      —–     ——    Operating income               313.4      178.2      527.2      316.4  Other (expense)   income, net                      (0.2)       2.2       (0.7)       4.8                                    —-        —       —-        —    Income from continuing     operations before     income taxes                  313.2      180.4      526.5      321.2  Income tax expense                (2.5)         –       (4.6)         –                                    —-        —       —-        —    Income from continuing     operations                    310.7      180.4      521.9      321.2  Less: Net income   attributable to   noncontrolling interests         (5.8)      (5.8)     (11.0)     (10.0)                                    —-       —-      —–      —–    Net income attributable     to  MillerCoors LLC          $304.9     $174.6     $510.9     $311.2                                  ======     ======     ======     ======
————————————————————————–  Notes:  ——  (1) Economic ownership of MillerCoors LLC is 58% held by SABMiller and 42%  held by Molson Coors.  See Table 5 in the release for a reconciliation  from MillerCoors net income to Molson Coors equity income in MillerCoors.

Molson Coors Brewing Company and Subsidiaries  Table 12:  Condensed Consolidated Balance Sheets  (In Millions)  (Unaudited)
As of                                          ———————————                                          June 28, 2009   December 28, 2008                                          ————-   —————–  Assets
Cash and cash equivalents                     $296.2              $216.2   Receivables, net                               732.2               635.4   Inventories, net                               234.4               192.1   Other, net                                      70.5                63.4                                                   —-                —-     Total current assets                       1,333.3             1,107.1
Properties, net                              1,242.3             1,301.9   Goodwill and intangibles, net                5,618.2             5,221.4   Investment in MillerCoors                    2,557.9             2,418.7   Other                                          294.5               337.5                                                  —–               —–     Total assets                             $11,046.2           $10,386.6                                              =========           =========
Liabilities and equity
Accounts payable                              $156.7              $170.5   Accrued expenses and other                     941.7               815.5   Short-term borrowings and current    portion of long-term debt                       0.1                 0.1                                                    —                 —     Total current liabilities                  1,098.5               986.1
Long-term debt                               1,628.6             1,752.0   Pension and post-retirement benefits           492.8               581.0   Other                                        1,132.0             1,028.1                                                ——-             ——-     Total liabilities                          4,351.9             4,347.2
Total MCBC stockholders’ equity              6,680.1             6,055.4   Noncontrolling interests                        14.2               (16.0)                                                   —-               —–     Total equity                               6,694.3             6,039.4                                                ——-             ——-     Total liabilities and equity             $11,046.2           $10,386.6                                              =========           =========

Molson Coors Brewing Company and Subsidiaries  Table 13:  Condensed Consolidated Statements of Cash Flows  (In Millions)  (Unaudited)
Twenty-six Weeks Ended                                           —————————-                                           June 28, 2009  June 29, 2008                                           ————-  ————-
Cash flows from operating activities:   Net income                                   $264.0         $124.5    Adjustments to reconcile net income     to net cash provided by     operating activities:       Depreciation and amortization              88.8          167.2       Equity income in MillerCoors             (231.2)             –       Distributions from MillerCoors            250.3              –        Change in working capital and        other, net                               (19.4)        (131.1)                                                 —–         ——    Net cash provided by operating    activities                                   352.5          160.6
Cash flows from investing     activities:      Additions to properties and       intangible assets                          (45.2)        (136.4)      Proceeds from sales of assets and       businesses, net                              2.6           33.5      Acquisition of businesses                   (19.6)             –      Investment in MillerCoors, net             (119.3)             –      Other, net                                  (28.8)           8.6                                                 —–            —    Net cash used in investing     activities                                 (210.3)         (94.3)
Cash flows from financing     activities:      Exercise of stock options under       equity compensation plans                  13.4           45.9      Dividends paid                             (81.4)         (65.5)      Net repayments of debt                      (0.3)        (147.6)      Other                                        6.3            9.3                                                   —            —    Net cash used in financing     activities                                  (62.0)        (157.9)
Cash and cash equivalents:     Net increase (decrease) in cash and      cash equivalents                            80.2          (91.6)     Effect of foreign exchange rate      changes on cash and cash      equivalents                                 (0.2)          (1.0)     Balance at beginning of year                216.2          377.0                                                 —–          —–   Balance at end of period                     $296.2         $284.4                                                ======         ======
Source: Molson Coors Brewing Company

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