Molson Coors(US:TAP)2023-02-20 16:00Financial Performance - Net sales for the year ended December 31, 2022, were $10,701.0 million, an increase of 4.1% from $10,279.7 million in 2021[358]. - The company reported a net loss of $186.5 million for 2022, compared to a net income of $1,008.5 million in 2021, representing a significant decline[360]. - Gross profit decreased to $3,655.2 million in 2022 from $4,053.4 million in 2021, reflecting a decline of 9.8%[358]. - Operating income fell sharply to $157.5 million in 2022, down from $1,454.4 million in 2021, indicating a decrease of 89.2%[358]. - The company reported a comprehensive loss of $388.4 million in 2022, compared to a comprehensive income of $1,169.8 million in 2021[360]. - Operating cash flow for 2022 was $1,502.0 million, a decrease from $1,573.5 million in 2021[365]. - The company reported a net cash outflow from financing activities of $889.5 million in 2022, compared to an outflow of $1,172.2 million in 2021[365]. Goodwill and Impairment - The goodwill balance related to the Americas reporting unit as of December 31, 2022, is $5,292 million[353]. - An impairment loss of $845 million was recognized due to the carrying value exceeding the fair value of the Americas reporting unit[353]. - The company experienced a goodwill impairment of $845.0 million in 2022, compared to no impairment in 2021[358]. - The company evaluates goodwill for impairment at least annually, with the last test performed on October 1, 2022[430]. - An impairment loss of $28.6 million was recognized in Q1 2022 related to the Truss joint venture asset group, with $12.1 million attributable to noncontrolling interest[499]. Debt and Liabilities - The company had $4.9 billion in USD denominated fixed rate debt as of December 31, 2022, with a fair value liability of $(4.3 billion)[324]. - Total long-term debt, including the current portion, decreased from $7,155.2 million as of December 31, 2021 to $6,541.4 million as of December 31, 2022[509]. - The fair value of outstanding long-term debt was approximately $5.9 billion as of December 31, 2022, down from $7.7 billion as of December 31, 2021, primarily due to rising interest rates[512]. - Current liabilities decreased to $3,375.4 million in 2022 from $3,622.2 million in 2021, a decline of 6.8%[363]. - Total accounts payable and other current liabilities decreased from $3,107.3 million as of December 31, 2021 to $2,978.3 million as of December 31, 2022[501]. Revenue Recognition - Revenue from owned brands, partner brands, and imported brands is recognized when control is transferred to the customer[388]. - The company has licensing agreements with third-party partners, recognizing revenue based on the amount of products sold at an agreed-upon royalty rate[390]. - Variable consideration in revenue includes promotional discounts and volume rebates, requiring estimates and assumptions that affect revenue timing and amounts[392]. - The company does not have standard terms for product returns but estimates returns based on historical experience, adjusting revenue accordingly[393]. Market and Operational Risks - The company is exposed to volatility in interest rates with regard to its current and future debt offerings, specifically related to U.S. Treasury rates and LIBOR[322]. - The company is subject to risks related to the ongoing Russia-Ukraine conflict and other geopolitical tensions that could adversely affect its business[19]. - The company experienced significant cost inflation, particularly in material, transportation, and energy costs, which negatively impacted operations in 2022 and is expected to continue affecting results in 2023[374]. - The company has been actively monitoring the impacts of the coronavirus pandemic, which has created uncertainty in operations and consumer behavior[375]. Internal Controls and Audit - Management's assessment of internal control over financial reporting was concluded to be effective as of December 31, 2022[340]. - The consolidated financial statements present fairly the financial position of the company as of December 31, 2022, in conformity with GAAP[346]. - The audit firm PricewaterhouseCoopers LLP has served as the company's auditor since 1974[356]. - The audit committee monitors the company's accounting control systems and meets at least quarterly with management and auditors[342]. Equity and Dividends - The total equity of the company as of December 31, 2022, was $13,673.1 million[367]. - Dividends paid in 2022 totaled $329.3 million, significantly higher than $147.8 million in 2021[365]. - The company declared a cash dividend of $0.38 per share on November 10, 2022, totaling $1.52 per share for the year ended December 31, 2022[414]. - Dividends declared for the year ended December 31, 2022, amounted to $(332.1) million, compared to $(148.4) million in 2021, indicating a significant increase in dividend payouts[368]. Asset Management - Total assets decreased to $25,868.3 million as of December 31, 2022, down from $27,619.0 million in 2021, a reduction of 6.3%[363]. - The gross carrying value of goodwill as of December 31, 2022, was $8,178.0 million, with accumulated impairment losses totaling $2,886.1 million[483]. - Intangible assets, net, decreased from $13,286.8 million as of December 31, 2021, to $12,800.1 million as of December 31, 2022, primarily due to foreign exchange impacts[485]. - Finished goods inventory decreased from $351.5 million as of December 31, 2021, to $269.1 million as of December 31, 2022, while raw materials increased from $271.2 million to $290.4 million in the same period[478].