What changed in this filing

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Item 1. Business

2022-02-23 compared with 2021-02-11 · 322 added, 245 removed, 225 unchanged (72% of the section changed)

Unless otherwise noted in this report, any description of "we," "us" or "our" includes Molson Coors Beverage Company ("MCBC," "Molson Coors" or the "Company") (formerly known as Molson Coors Brewing Company), principally a holding company, and its operating and non-operating subsidiaries included within our reporting segments.

On January 1, 2020, we changed our management structure from a corporate center and four segments to two segments - North America and Europe.

Our International segment was reconstituted with the Africa and Asia Pacific businesses reporting into the Europe segment and the remaining International business reporting into the North America segment.

Accordingly, effective January 1, 2020, our reporting segments include:

North America (North America segment), operating in the U.S., Canada and various countries in the Caribbean, Latin and South America;

and Europe (Europe segment), operating in Bulgaria, Croatia, Czech Republic, Hungary, Montenegro, the Republic of Ireland, Romania, Serbia, the U.K., various other European countries, and certain countries within the Middle East, Africa and Asia Pacific.

We recast the historical presentation of segment information as a result of these reporting segment changes accordingly.

Unless otherwise noted in this report, any description of "we," "us" or "our" includes Molson Coors Beverage Company ("MCBC" or the "Company"), principally a holding company, and its operating and non-operating subsidiaries included within our reporting segments.

As of December 31, 2021, we changed the names of our reporting segments to the Americas and EMEA&APAC segments (formerly named the North America segment and Europe segment, respectively) to better reflect the geographic locations encompassed within the reportable segments.

This change to our segment names had no impact on the composition of our segments, our financial position, results of operations, cash flow or segment level results previously reported.

Our Americas segment operates in the U.S., Canada and various countries in the Caribbean, Latin and South America and our EMEA&APAC segment operates in Bulgaria, Croatia, Czech Republic, Hungary, Montenegro, the Republic of Ireland, Romania, Serbia, the U.K., various other European countries, and certain countries within the Middle East, Africa and Asia Pacific.

Certain figures and certain discussions of markets throughout this section focus on the largest regions of our Americas segment and excludes discussion of Latin America and the Caribbean due to data not being readily available.

Certain figures and certain discussions of markets throughout this section focus on the largest region of our EMEA&APAC segment and excludes discussions of the Middle East, Africa and APAC due to data not being readily available.

Unless otherwise indicated, information in this report is presented in USD and comparisons are to comparable prior periods.

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From Coors Light , Miller Lite, Molson Canadian, Carling, and Staropramen to Coors Banquet, Blue Moon Belgian White, Blue Moon LightSky, Vizzy, Coors Seltzer, Leinenkugel’s Summer Shandy, Creemore Springs, Hop Valley and more, we produce many beloved and iconic beer brands.

While the Company’s history is rooted in beer, we offer a modern portfolio that expands beyond the beer aisle as well.

While our Company’s history is rooted in beer, we offer a modern portfolio that expands beyond the beer aisle as well.

As a business, our ambition is to be the first choice for our people, our consumers and our customers, and our success depends on our ability to make our products available to meet a wide range of consumer segments and occasions.

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Upon completion of the Merger, Adolph Coors Company changed its name to Molson Coors Brewing Company.

In January 2020, we changed our name from Molson Coors Brewing Company to Molson Coors Beverage Company in connection with our revitalization plan.

As we continue to evolve our strategy and portfolio to appeal to the ever-changing preferences of our consumer base, we are also broadening our range of products and offerings within our portfolio.

Expanded offerings include, among others, hard seltzers and a variety of non-alcoholic offerings.

On October 11, 2016, we entered into a purchase agreement with Anheuser-Busch InBev SA/NV to acquire 100% of the outstanding equity and voting interests of MillerCoors, previously a joint venture between MCBC and the former SABMiller plc.

In January 2020, we changed our name from Molson Coors Brewing Company to Molson Coors Beverage Company in connection with our expansion beyond the beer aisle.

Our revitalization plan, announced on October 28, 2019, focuses on the execution of the following principal strategies:

building on the strength of our iconic core brands, growing our above premium portfolio, expanding beyond the beer aisle and investing in our capabilities and supporting our people and communities.

Through the execution of the revitalization plan, we broadened our range of products and offerings within our portfolio to also include, among others, hard seltzers, ready to drink beverages and a variety of non-alcoholic beverage offerings.

In order to support the overall premiumization of our portfolio, we have strategically de-prioritized certain non-core economy SKUs.

The revitalization plan is intended to drive sustainable net sales and earnings growth, despite potential volume declines as the portfolio mix shifts towards a higher composition of above premium products.

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Coronavirus Global Pandemic

The coronavirus pandemic had a material adverse effect on our operations, liquidity, financial condition and results of operations in 2020 and we currently expect it will continue to have a material impact to our financial results in 2021 and possibly beyond.

The extent to which our operations will continue to be impacted by the pandemic will depend largely on future developments, which are highly uncertain and cannot be accurately predicted, including new information which may emerge concerning the severity and duration of the outbreak, roll out and efficacy of the vaccines, and actions by government authorities to contain the pandemic or treat its impact, among other things.

We continue to actively monitor the ongoing evolution of the pandemic and resulting impacts to our business and have taken various mitigating actions in response to the impacts of the pandemic and to position our business for the long term.

See further discussion of the status of the pandemic and its impacts on our Company, including the on- and off-premise impacts to our segments in Part II.

Starting at the end of the first quarter of 2020, the coronavirus pandemic had a material adverse effect on our operations, liquidity, financial condition and results of operations.

In 2021, we saw improvements in the marketplace related to the coronavirus global pandemic as on-premise locations began to re-open around the world at varying degrees, despite setbacks in certain markets related to the outbreak of new variants.

The extent to which our operations will continue to be impacted by the coronavirus pandemic will depend largely on future developments, which are highly uncertain and cannot be accurately predicted, including the level of governmental or societal orders or restrictions on public gatherings and on-premise venues, including any vaccine mandates or testing requirements, the severity and duration of the coronavirus pandemic by market, including outbreaks of variants, changes in consumer behavior, inflationary pressures resulting from the coronavirus pandemic, the rate of vaccination and the efficacy of vaccines against the coronavirus and related variants.

We continue to actively monitor the ongoing evolution of the coronavirus pandemic and resulting impacts to our business.

See further discussion of the status of the coronavirus pandemic and its impacts on our Company, including the on- and off-premise impacts to our segments in Part II.

Management's Discussion and Analysis .

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The industry was previously founded on local presence with modest international expansion achieved through export, license and partnership arrangements.

Over time the market has become increasingly complex as the consolidation of brewers has occurred globally,

resulting in a small number of large global brewers representing the majority of the worldwide beer market.

Over time the market has become increasingly complex as the consolidation of brewers has occurred globally, resulting in a small number of large global brewers representing the majority of the worldwide beer market.

In addition to the consolidation and the acquisitive nature of the industry, exports, licensing and partnership arrangements continued to be used and these transactions typically occurred between the same global competitors that make up the majority of the market.

At the same time, smaller local brewers within certain established markets have experienced accelerated growth as consumers increasingly place value on locally-produced, regionally-sourced products.

In addition to the growth of smaller local craft breweries, changing consumer trends are pushing the industry toward above premium beer, flavored malt beverages and beyond beer altogether.

In recent years, the hard seltzer market has emerged and has experienced phenomenal growth, particularly in the U.S..

We believe the hard seltzer market will continue to gain traction and be of increasing importance.

In addition to the growth of smaller local craft breweries, changing consumer trends are pushing the industry toward above premium, including flavored malt beverages, craft beer and beyond beer altogether.

In recent years, the hard seltzer market has emerged and has experienced significant growth, particularly in the U.S.

While we do not believe that the rapid growth will continue as the market has matured, we do believe the hard seltzer market will continue to be of importance.

As the beer industry continues its evolution of consolidation and diversification of its products to meet consumer demand with broadening preferences, we believe large global brewers are uniquely positioned to leverage the scale, depth of product portfolio and industry knowledge to continue to lead the market forward.

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Global Competitors' Market Capitalization

We evaluate ourselves in relation to other global brewers using various metrics, including overall market capitalization, volume, net sales revenue, gross margins and net profits, as well as our position within each of our core markets, with the goal to be the first choice for our people, consumers and customers.

We evaluate ourselves in relation to other global brewers using various metrics, including overall market capitalization, volume, net sales, gross margins and net profits, as well as our position within each of our core markets, with the goal to be the first choice for our people, consumers and customers.

To provide a perspective of the relative size of the major participants in the global brewing market, the market capitalization of our primary global competitors, based on foreign exchange rates as of December 31, 2021, were as follows:

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("Asahi") $ 19.7

We have a diverse portfolio of beloved and iconic owned and partner brands including Blue Moon, Coors Banquet, Coors Light, Miller Genuine Draft, Miller Lite and Staropramen .

We have a diverse portfolio of beloved and iconic owned and partner brands including Blue Moon, Carling, Coors Banquet, Coors Light, Miller High Life, Miller Genuine Draft, Miller Lite and Staropramen .

We continue to invest in and focus on growing these brands.

In addition to these iconic brands, we offer premium, premium lights, economy, above premium and craft beers.

Further, we offer a modern and growing portfolio that expands beyond the beer aisle as well.

We craft high-quality, innovative beverages with the purpose of uniting people to celebrate all life’s moments.

Additionally, as we continue to evolve our strategy and portfolio to appeal to the ever-changing preferences of our consumer base, we are also broadening our range of products and offerings within our portfolio.

This includes our current and emerging plans in the non-alcoholic beverage segment.

The following includes our primary brands sold in each of our segments.

Brands sold in North America

In addition to these iconic brands, we offer products in the above premium, including flavored malt beverages (which includes hard seltzers), craft and ready to drink beverages, premium (which includes premium lights) and economy segments.

Further, our modern and growing portfolio expands beyond the beer aisle as well.

We craft and distribute high-quality, innovative beverages with the purpose of uniting people to celebrate all life’s moments.

The following includes the primary brands sold in each of our segments.

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Brands sold in the Americas Segment

Arizona Hard Green Tea (3)

Pilsner Urquell (1)

Hop Valley brands

Arnold Palmer Spiked (3)

Atwater Brewing brands Icehouse Revolver

Belgian Moon Keystone Rickard's

Belgian Moon LightSky Le Trou du Diable Saint Archer

Icehouse Revolver brands

Atwater Brewing brands

Keystone Rickard's

Belgian Moon La Colombe (5)

Belgian Moon LightSky Le Trou du Diable Steel Reserve

Blue Moon Leinenkugel's

Smith & Forge

Blue Moon LightSky Mad Jack Staropramen

Brasseurs de Montréal brands Mickey's Steel Reserve

Carling Miller64 Terrapin brands

Carling Black Label Miller Genuine Draft Vizzy

Coors Banquet Miller High Life

Coors Edge Miller Lite

Coors Light Milwaukee's Best Licensed premium import brands (2)

Coors Original Molson Canadian Dos Equis

Coors Seltzer Molson Dry Heineken

Coors Slice Molson Export Heineken 0.0

Creemore Springs Molson Ultra Moretti

Crispin Movo Sol

Exel Old Style Pilsner Strongbow cider

Terrapin brands

Blue Moon LightSky Mad Jack Topo Chico Hard Seltzer (6)

Brasseurs de Montréal brands

Mickey's Vizzy Hard Seltzer

Carling Miller64 ZOA (7)

Carling Black Label Miller Genuine Draft

Coors Banquet Miller High Life Licensed premium import brands (2)

Coors Edge Miller Lite Dos Equis

Coors Light Milwaukee's Best Heineken

Coors Original Molson Canadian Heineken 0.0

Coors Seltzer Molson Dry Moretti

Coors Slice Molson Export Sol

Creemore Springs Molson Ultra Strongbow cider

Exel Old Style Pilsner

Granville Island Olde English

Hamm's Peroni Nastro Azurro (1)

Henry's Hard Soda Pilsner Urquell (1)

(1) Under perpetual royalty-free license from Asahi.

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(4) Under perpetual royalty-free license from ABI.

Brands sold in Europe

(5) Under a distribution agreement with La Colombe Torrefaction, Inc.

(6) Under brand authorization agreements with The Coca Cola Company.

(7) Under a distribution agreement with Zoa Energy, LLC.

Brands sold in the EMEA&APAC Segment

Aspall Cider Cobra (1)

Coors Light Rekorderling Cider (1)

Coors Ozujsko

Corona Extra (1)

Sharp's Doom Bar

Bergenbier Jelen Staropramen

Blue Moon Kamenitza Stella Artois (1)

Rekorderling Cider (1)

Bergenbier Jelen Sharp's Doom Bar

Blue Moon Kamenitza Staropramen

Borsodi Lowenbrau (1)

Branik Miller Genuine Draft

Carling Niksicko

(1) The European business has licensing and distribution agreements with various other brewers through which it also brews and distributes Beck's, Lowenbrau, Stella Artois and Spaten, as well as a distribution agreement for the exclusive distribution of the Corona brand, throughout the Central European countries in which we operate.

Stella Artois (1)

Branik Madri Three Fold Hard Seltzer

Carling Miller Genuine Draft

(1) The European business has licensing and distribution agreements with various other brewers through which it also brews and distributes Beck's, Lowenbrau and Stella Artois, as well as a distribution agreement for the exclusive distribution of the Corona brand, throughout the Central European countries in which we operate.

We have an agreement with Dutch brewer, Bavaria, for the exclusive on-premise and off-premise rights to the sales, distribution and customer marketing of Bavaria and its portfolio of brands in the U.K.

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on-premise customers, we sell "factored" brands, which are third-party beverage brands for which we provide distribution to retail, typically on a non-exclusive basis.

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In 2021, we operated the following segments:

North America and Europe.

A separate operating team manages each segment and each segment manufactures, markets, and sells beer as well as offers a modern and growing portfolio that expands beyond the beer aisle.

Americas and EMEA&APAC.

A separate operating team manages each segment and each segment manufactures, markets, distributes and sells beer as well as offers a modern and growing portfolio that expands beyond the beer aisle.

No single customer accounted for more than 10% of our consolidated sales in 2021, 2020 or 2019.

North America Segment

Americas Segment

• Headquarters:

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• Approximately 9,800 employees as of December 31, 2021

• North America's oldest beer company and second largest brewer by volume in North America, representing approximately 22% of the total 2020 North America beer market.

• Currently operating nine primary breweries, eleven craft breweries and two container operations in North America.

The North America segment also includes a partnership arrangement related to the distribution of beer in Ontario, Canada, Brewers' Retail Inc.

• North America's oldest beer company and second largest brewer by volume in North America, representing approximately 20% of the total 2021 North America beer market, which is the largest region of our Americas segment.

• Currently operating nine primary breweries, ten craft breweries and two container operations.

The Americas segment also includes a partnership arrangement related to the distribution of beer in Ontario, Canada, Brewers' Retail Inc.

("BRI"), and in the western provinces of Canada, Brewers' Distributor Ltd.

BRI and BDL are accounted for under the equity method of accounting.

The majority of ownership in BRI resides with Molson Coors Canada ("MCC"), Labatt Breweries of Canada LP (a subsidiary of ABI) and Sleeman Breweries Ltd.

The majority of ownership in BRI resides with Molson Canada 2005 (a wholly-owned subsidiary of our Company), Labatt Breweries of Canada LP (a subsidiary of ABI) and Sleeman Breweries Ltd.

(a subsidiary of Sapporo International).

BDL is jointly owned by MCC and ABI.

BDL is jointly owned by Molson Canada 2005 and ABI.

In addition, we have an agreement with Heineken that grants us the right to import, market, distribute and sell certain Heineken products in Canada.

The North America segment also includes Truss, our joint venture with HEXO Corp.

("HEXO") in Canada, which launched its first non-alcoholic cannabis infused product, Veryvell Drops , and its ready to drink beverage portfolio across the Canadian market in 2020.

Separately, in April 2020, we completed the formation of a new joint venture with HEXO and it launched its first non-alcoholic hemp-derived cannabidiol ("CBD") beverages in Colorado.

Additionally, in the third quarter of 2020, we, in collaboration with D.G.

The Americas segment also includes Truss, our joint venture with HEXO Corp.

("HEXO") in Canada which produces and markets non-alcoholic, cannabis-infused beverages in Canada.

Additionally, in the third quarter of 2020, in collaboration with D.G.

Yuengling & Son, Inc.

("Yuengling"), formed The Yuengling Company LLC ("TYC"), a joint venture equally owned by MCBC and DGY West Holdings, LP ("DGY West") that was formed to expand commercialization of Yuengling's brands with operations currently expected to commence in the second half of 2021.

("Yuengling"), we formed The Yuengling Company LLC ("TYC"), a joint venture equally owned by MCBC and DGY West Holdings, LP ("DGY West") that, pursuant to an operating agreement, was formed to expand commercialization of Yuengling's brands for any new market expansion outside of Yuengling's then 22-state footprint and New England.

During the third quarter of 2021, TYC commenced retail operations with its first product sales in the state of Texas.

Sales and Distribution

Our go to market strategy differs slightly between the geographic regions of North America due to the differences in regulations among those geographic areas.

In the United States, beer is generally distributed through a three-tier system consisting of manufacturers, distributors and retailers.

Our go to market strategy differs slightly between the geographic regions of the Americas segment due to the differences in regulations among those geographic areas.

In the U.S., beer is generally distributed through a three-tier system consisting of manufacturers, distributors and retailers.

A national network of approximately 350 independent distributors and one Company-owned distributor, Coors Distributing Company, purchases our products and distributes them to on- and off-premise retail accounts.

Coors Distributing Company distributed approximately 2% of our total owned and non-owned volume in 2020.

Coors Distributing Company distributed approximately 2% of our total owned and non-owned Americas segment volume in 2021.

Transportation of our product to distributors in the U.S.

is primarily contracted through third-party logistics providers and shipped by truckload.

We have long-term contracts in place with third-party logistics providers to mitigate price fluctuations in freight costs.

In instances where transportation needs cannot be met by contracted freight carriers, we utilize the spot freight market.

Over the years, the trucking industry has experienced an aging driver demographic which has led to a decreased supply of truck drivers.

Additionally, since the onset of the coronavirus pandemic, this trend accelerated as the trucking industry has seen an increased shortage in truck drivers which has resulted in inflation across certain supply chains.

In response to trends seen within the transportation industry, we have begun to transport more products via railway, through insulated boxcars or intermodal shipping containers, as an action taken to mitigate the level of inflation seen in freight costs within the trucking industry.

In Canada, because provincial governments regulate the beer industry and provincial liquor boards control the distribution and retail sale of alcohol products, distribution strategies vary by province.

The transportation of our products in Canada varies by the go to market strategy in each province.

In Ontario, beer is primarily purchased at retail outlets operated by BRI, at government-regulated retail outlets operated by the Liquor Control Board of Ontario ("LCBO"), at approved agents of the LCBO, at certain licensed grocery stores, or at any bar, restaurant, or tavern licensed by the LCBO to sell alcohol for on-premise consumption.

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Brewers may deliver directly to BRI's outlets or may choose to use BRI's distribution centers to access retail stores in Ontario, the LCBO system, the grocery channel and licensed establishments.

We primarily distribute our products to The Beer Store by truckload.

In June 2019, the Ontario government adopted a bill that, if enacted, would terminate a 10-year Master Framework Agreement that was originally signed between the previous government administration and Molson Coors, Labatt Brewing Company Limited, Sleeman Breweries Ltd., and BRI in 2015 and governs the terms of the beer distribution and retail systems in Ontario through 2025.

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Risk Factors , Part II, Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations and Part II, Item 8 Financial Statements and Supplementary Data, Note 18, "Commitments and Contingencies" for further discussion.

In Québec, the distribution and sale of beer is governed by the Quebec Alcohol Corporation ("SAQ").

Beer is distributed to retail outlets directly by each brewer or through approved independent agents.

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Discussion and Analysis of Financial Condition and Results of Operations and Part II, Item 8 Financial Statements and Supplementary Data, Note 18, "Commitments and Contingencies" for further discussion.

In Québec, the distribution and sale of beer is governed by the Québec Alcohol Corporation ("SAQ").

Beer is distributed to retail outlets, primarily by truckload, directly by each brewer or through approved independent agents.

We are the agent for the licensed brands we distribute.

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Québec retail sales for off-premise consumption are made through grocery and convenience stores, as well as government operated outlets.

BDL, which we co-own with ABI, manages the distribution of our products throughout British Columbia, Alberta, Manitoba and Saskatchewan.

Our products are distributed and sold by local liquor boards in the Maritime Provinces, except

Newfoundland, independent distributors in Newfoundland and government liquor commissioners in Yukon, Northwest territories, and Nunavut.

BDL manages the distribution of our products throughout British Columbia, Alberta, Manitoba and Saskatchewan.

Our products can be purchased by consumers at the government's Liquor Distribution Branch retail outlet, at any independently owned and licensed retail store or at any licensed establishment for on-premise consumption in British Columbia and, in Alberta, at retail outlets licensed by the Alberta Gaming and Liquor Commission or licensees such as bars, hotels and restaurants.

BDL primarily distributes products to customers by truckload.

Our products are distributed and sold by local liquor boards in the Maritime Provinces, except Newfoundland, independent distributors in Newfoundland and government liquor commissioners in Yukon, Northwest territories and Nunavut.

In the Caribbean, Latin and South America, we use a combination of export models and license agreements to sell Blue Moon, Coors Light, Miller Genuine Draft, Miller High Life, Miller Lite and other brands.

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References to on- and off-premise sales volumes are sales to retailers, which we believe is a useful data point relative to consumer trends.

In North America, the on-premise channel includes sales to bars and restaurants while the off-premise channel includes sales in convenience stores, grocery stores, liquor stores and other retail outlets including The Beer Store in Ontario, Canada which is Canada's largest beer retailer and is co-owned by Ontario's three largest brewers.

The following table reflects the industry channel share trends over the last five years in the largest regions in our North America segment of Canada and the U.S.

In the Americas segment, the on-premise channel includes sales to bars and restaurants while the off-premise channel includes sales in convenience stores, grocery stores, liquor stores and other retail outlets including The Beer Store in Ontario, Canada which is Canada's largest beer retailer.

The following table reflects the industry channel share trends over the last five years in the largest regions of our Americas segment, the U.S.

Percentages reflect estimates based on market data currently available.

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Off-premise 87 % 91 % 84 % 84 % 84 %

We continue to monitor the coronavirus pandemic, which has had a material adverse effect on our North America operations, liquidity, financial condition and results of operations in the second quarter of 2020 due to on-premise closures.

The pandemic continued to have a significant adverse effect during the third and fourth quarters of 2020 due to the on-premise locations only being open at partial capacity and at reduced hours.

We currently expect these significant adverse effects to continue into 2021 as on-premise locations have experienced, and we believe will continue to experience, capacity and hour limitations.

The effects of the pandemic remain highly uncertain especially around the duration of the outbreak and actions by government authorities to contain the pandemic or address its impact, among other things.

We estimate that approximately 9% and 9% of 2020 North America volume and net sales, respectively, were from the on-premise channel.

This compares to our 2019 estimate that approximately 16% and 17% of our volume and net sales, respectively, were from the on-premise channel which tends to be more profitable than the off-premise channel as a result of its higher above premium brand mix, higher net sales revenue per hectoliter and lower package costs due to the higher volume of kegs sold.

We have seen some of the on-premise demand shift to the off-premise;

however, this shift has not been proportionate to the severe declines in volume lost from the on-premise closures and weakened demand.

As a result of the coronavirus pandemic and resulting government-imposed restrictions and related on-premise closures, this portion of our business effectively ceased entirely from the middle of March 2020 into June 2020.

Additionally, continuing governmental or societal impositions on bars and restaurants and restrictions on public gatherings including the growing risk of a return of shutdowns, especially if prolonged in nature, we expect will continue to have adverse effects on on-premise traffic and, in turn, our business performance, cash flows and liquidity.

Management's Discussion and Analysis, "Executive Summary" & Results of Operations— "North America," for further details.

Prior to the year ended December 31, 2020, the split between on-premise and off-premise remained relatively stable.

During the year ended December 31, 2020, we experienced a significant adverse impact resulting from the closure of the on-premise channel and increased restrictions as a result of the on-set of the coronavirus pandemic which effectively shut down the on-premise channel in the U.S.

and Canada which began in March 2020 and continued into June 2020.

During the second half of 2020, we saw a limited on-premise channel reopening in the U.S.

and Canada as the on-premise channel was restricted at varying degrees.

During the year ended December 31, 2021, we began to see a return to the on-premise channel in the U.S.

and Canada as a result of the on-premise channel progressively reopening.

However, business and consumer uncertainty in this channel persisted and, as a result, we did not see a full return to pre-pandemic levels.

While improvement has occurred in many provinces in Canada in 2021, the level of restrictions continues to evolve, frequently moving along a spectrum between full lock down and the easing of restrictions based on the evolution of the coronavirus pandemic and related variants.

As we continue to recover from the coronavirus pandemic, any governmental or societal impositions of restrictions on public gatherings, including any vaccine mandates or testing requirements, especially if prolonged in nature will continue to impact on-premise traffic and, in turn, our business.

Management's Discussion and Analysis, " Items Affecting Reported Results " & " Segment Results of Operations— America s " , for further details.

Manufacturing, Production and Packaging

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We use high quality ingredients to brew our products.

Hops used in our North American products are purchased from suppliers in the U.S.

Hops used to brew our products are purchased from suppliers in the U.S.

These contracts vary in length based on market conditions and cover our supply requirements through 2022.

We malt a portion of our production requirements in North America, using barley purchased primarily under annual contracts from independent farmers located predominately in the western United States and Canadian Prairies.

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We malt a majority of our production requirements in the U.S.

and Canada, using barley purchased primarily under annual contracts from independent farmers located predominately in the western U.S.

and Canadian Prairies.

In addition, we source barley malt from three other commercial providers, from which we have a committed supply until at least 2022.

brewing adjuncts are sourced from three main suppliers, all in North America, through 2022.

Other malt and cereal grains are purchased primarily from North American suppliers.

In North America we both own and lease water rights, as well as purchase water through local municipalities and communities, to provide for and sustain brewing operations in case of a prolonged drought in the regions where we have operations.

Other brewing adjuncts are sourced from three main suppliers, all in the U.S.

and Canada, with committed supply through 2022.

Other malt and cereal grains are purchased primarily from suppliers in the U.S.

and Canada, we both own and lease water rights, as well as purchase water through local municipalities and communities, to provide for and sustain brewing operations in case of a prolonged drought in the regions where we have operations.

We do not currently anticipate future difficulties in accessing water or agricultural products used in our brewing process in the near term.

Packaging Materials

The following summarizes the percentage of our largest regions of Canada and the U.S.

in our North America segment's packaging materials by type for the year ended December 31, 2020.

The below chart shows a meaningful shift to aluminum cans in 2020, largely as a result of changes in consumer behavior throughout the coronavirus pandemic.

In fiscal year 2019, aluminum cans made up 69% of packaging materials in North America.

Aluminum cans or bottles (collectively, aluminum containers):

The following summarizes the percentage of packaging materials by type for the largest regions of our Americas segment, the U.S.

and Canada, for the year ended December 31, 2021.

In recent years, we saw a shift to aluminum cans from glass bottles, and this trend accelerated during the year ended December 31, 2020 as a result of the on-premise channel closing at various degrees from March 2020 into June 2020.

While we saw a shift back from aluminum cans to kegs during the year ended December 31, 2021, as a result of the on-premise progressively reopening, aluminum cans continue to represent a greater percentage of packaging materials as compared to the years prior to the coronavirus pandemic.

Aluminum cans or bottles

• A portion of the aluminum cans and ends was purchased from Rocky Mountain Metal Container ("RMMC"), our joint venture with Ball Corporation ("Ball"), whose production facilities, which are leased from us, are located near our brewery in Golden, Colorado.

• In addition to the supply agreement with RMMC, we have a supply agreement with Ball to purchase aluminum containers in excess of what is supplied through RMMC.

• The RMMC joint venture agreement along with the cans and ends purchase agreement each expire on December 31, 2021.

We are currently in negotiations and do not anticipate any issues in renegotiating and extending these contracts.

• In addition to the supply agreement with RMMC, we have a supply agreement with Ball to purchase aluminum containers in addition to what is supplied through RMMC.

The supply agreement with Ball expires on December 31, 2023.

Additionally, we have commercial arrangements with other can suppliers to provide sleek cans.

We are currently in negotiations with these sleek can suppliers and do not anticipate an issue in finalizing these contracts.

• The RMMC joint venture agreement along with the cans and ends purchase agreement are in process of being renegotiated and we do not anticipate an issue in finalizing these contracts.

• In Canada, we source cans and ends from two primary providers with the related contracts ending December 31, 2023.

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The RMBC joint venture agreement expires on July 31, 2025.

• In addition to the supply agreement with RMBC, we have a supply agreement with Owens for requirements in excess of RMBC's production, which expires on December 31, 2021.

We are currently in negotiations and do not anticipate any issues in renegotiating and extending these contracts.

• In Canada, we single source glass bottles and have a committed supply through December 2021.

We are currently in negotiations and do not anticipate any issues in renegotiating and extending these contracts.

Ta b l e of C o n t e n t s

• In addition to the supply agreement with RMBC, we have a supply agreement with Owens for requirements in excess of RMBC's production, which expires on March 31, 2022.

We are currently renegotiating the agreement and do not anticipate an issue in extending these contracts.

• In Canada, we single source glass bottles and have a committed supply through March 2022.

We are currently in negotiations and do not anticipate an issue in renegotiating and extending the contract.

• The standard bottle for beer brewed in Canada is the 341 ml returnable bottle and represents the vast majority of our bottle sales.

• The distribution systems in each Canadian province generally provide the collection network for returnable glass bottles and aluminum cans.

Stainless steel kegs:

• Kegs are packaged in half, quarter, and one-sixth barrel stainless steel kegs in the United States and packaged in 58.67 liter, 50 liter, 30 liter, and 20 liter kegs in Canada.

Kegs and casks

• Kegs are packaged in half, quarter and one-sixth barrel stainless steel kegs in the U.S.

and packaged in 58.67 liter, 50 liter, 30 liter and 20 liter kegs in Canada.

• A limited number of kegs are purchased each year, and we have no long-term supply agreement.

Across North America, crowns, labels, corrugate and paperboard are purchased from a small number of sources unique to each product.

In recent years, we have experienced a shift in the allocation among different packaging types toward aluminum cans and bottles and away from glass bottles.

This accelerated in 2020 due to the coronavirus pandemic where we observed a shift in volume to off-premise channels and aluminum cans and away from on-premise channels and glass bottles.

In general, aluminum cans allow for lower packaging costs compared to most other types of packaging materials.

The trend away from glass bottles could result in higher fixed cost deleverage related to these assets and an ultimate decreased need for the assets that support this packaging, which could adversely impact profitability.

Across the Americas segment, crowns, labels, corrugate and paperboard are purchased from a small number of sources unique to each product.

In Canada, the standard returnable bottle requires significant investment behind our returnable bottle inventory and bottling equipment.

While we have experienced some challenges in obtaining supplies required for certain packaging materials in 2020 as a result of the pandemic, particularly certain types of aluminum containers in North America, these supply constraints are improving with most packaging materials, including certain glass and paperboard in North America, returning to normal material supply.

We currently anticipate aluminum container supplies returning to normal in the near term.

While we have experienced some challenges in obtaining supplies required for certain packaging materials in 2021 as a result of the global supply chain disruption, partially due to the impact of the coronavirus pandemic, these more severe supply constraints were short term in nature and overall, did not impact our ability to produce product and meet production forecasts.

Contract Manufacturing

We have an agreement to brew, package and ship products for Pabst Brewing Company, LLC and an agreement with North American Breweries, Inc.

("NAB") to brew and package certain Labatt brands for export.

We have agreements to brew, package and ship products for Pabst Brewing Company, LLC ("Pabst") and TYC, and an agreement with Labatt USA Operating Co, LLC to brew and package certain Labatt brands for export.

Seasonality of the Business

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Weather conditions consisting of high temperatures and extended periods of warm and dry weather favor increased consumption of our products, while unseasonably cool or wet weather, especially during the summer months, adversely affects our sales volumes and net sales.

Accordingly, consumption of beer in the North America segment is seasonal, nearly 40% of sales volume occurring during the summer months from May through August.

Accordingly, consumption of beer in the Americas segment is seasonal, with nearly 37% of sales volume occurring during the months from May through August.

Known Trends and Competitive Conditions

2020 North America Beer Industry Overview

The beer industry in North America is highly competitive, and the two largest brewers, ABI and MCBC together represented the majority of the market in 2020.

However, we estimate the two largest brewers lost share in 2020 due to volume growth in the import and flavored malt beverage (including hard seltzers) categories as consumer preferences continue to shift within the industry to above premium priced beers, flavored malt beverages, ready to drink alcoholic beverages and hard seltzers.

We believe growing or even maintaining our market share will require stabilizing our core brands and increasing our presence in the fast growing areas of the industry.

In Canada, the market is characterized by aggressive competition for volume and market share from regional brewers, microbrewers and certain foreign brewers, as well as our main domestic competitor.

These competitive pressures require significant annual investment in marketing and selling activities.

In 2020, the Ontario and Québec markets accounted for approximately 62% of the total beer market in Canada.

There are three major beer price segments:

above premium, which includes craft and most imports;

premium, which includes the majority of domestic brands and the light sub-segment;

and value (below premium).

Since 2001, the premium beer segment in Canada has gradually lost volume to the above premium and value segments.

Competition from outside of the beer category, as well as an aging population in Canada, continues to be a challenge for the beer industry.

The following table summarizes the estimated percentage market share by volume of beer (including flavored malt beverages) and other alcohol beverages, including wine and spirits, as a component of the overall North America alcohol market over the last five years.

2021 Beer Industry Overview

The beer industry in the largest regions of our Americas segment, the U.S.

and Canada, is highly competitive, and the two largest brewers, ABI and MCBC together represented the majority of the market in 2021.

However, the two largest brewers lost share in 2021 due to volume growth in the flavored malt beverage (including hard seltzers), import and super premium portfolios as consumer preferences continue to shift within the industry to above premium.

We believe growing or even maintaining our market share will require building on the strength of our core brands, premiumizing our portfolio and continuing to increase our presence in the fast-growing areas of the industry and beyond the beer aisle.

and Canada alcohol market over the last five years.

We anticipate that the 2021 data, when available, will reflect a continuation of the recent consumer trends.

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Other alcohol beverages 53 % 52 % 51 % 51 % 50 %

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Our Competitive Position

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These competing brands are produced by international, national, regional and local brewers.

We compete most directly with ABI brands, but also compete with imported and craft beer brands, as well as flavored malt beverages.

We compete most directly with ABI brands, but also compete with imports and other providers of craft beer and flavored malt beverages.

Our products also compete with other alcohol beverages, including wine and spirits, and thus their competitive position is affected by consumer preferences between and among these other categories.

Driven by, among other things, increased spirits advertising, a narrowing price gap with wine and spirits, along with increased wine and spirits sales execution, sales of wine and spirits have grown faster than sales of beer in recent years, resulting in a reduction in the beer segment's lead in the overall alcohol beverage market.

The following table summarizes the estimated percentage share of the North American beer market represented by Molson Coors, ABI and all other brewers over the last five years.

The following table summarizes the estimated percentage share of the largest regions of our Americas segment, U.S.

and Canada, represented by MCBC, ABI and all other brewers over the last five years.

Current year percentages reflect estimates based on market data currently available.

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business excise taxes on malt beverages were approximately $15 per hectoliter sold on a reported basis.

This includes the impact of the U.S.

This included the impact of the U.S.

Craft Beverage Modernization and Tax Reform Act, which took effect on January 1, 2018 for all qualified large domestic brewers and importers, and was made permanent by the U.S.

Consolidated Appropriations Act 2021 on December 27, 2020.

This law resulted in reduced excise taxes for MCBC in the U.S.

by $2 per barrel on the first six million barrels, which equates to $1.70 per hectoliter on this portion of volume.

We transfer a portion of our share of these savings to distributors consistent with the revenue splitting approach of our U.S.

This law resulted in reduced U.S.

federal excise taxes by $2 per barrel on the first six million barrels, which equated to $1.70 per hectoliter on this portion of our 2021 volume sold.

Our practice is to transfer a portion of these savings to distributors consistent with the revenue splitting approach of our U.S.

business' economic model.

State excise taxes are levied in specific states at varying rates.

Excise taxes are levied in specific state and local jurisdictions at varying rates.

Refer to Part I—Item 1A.

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In Canada, provincial governments regulate the production, marketing, distribution, selling and pricing of beer (including the establishment of minimum prices), and impose commodity taxes, mark-ups and license fees in relation to its production, distribution and sale.

In addition, the federal government regulates the advertising, labeling, quality control, and international trade of beer, and also imposes commodity taxes on both domestically produced and imported beer.

In addition, the Canadian federal government regulates the advertising, labeling, quality control, and international trade of beer, and also imposes commodity taxes on both domestically produced and imported beer.

Both levels of government are also similarly involved in other categories of alcoholic beverages produced or imported into Canada.

In 2020, our Canada business excise taxes were approximately $54 per hectoliter sold on a reported basis.

Further, certain bilateral and multilateral treaties entered into by the federal government, provincial governments and certain foreign governments, especially with the United States, affect the Canadian beer industry.

Europe Segment

In 2021, our Canadian business excise taxes, federal and provincial, were approximately $59 per hectoliter sold on a reported basis.

Further, certain bilateral and multilateral treaties entered into by the federal government, provincial governments and certain foreign governments, especially with the U.S., affect the Canadian beer industry.

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EMEA&APAC Segment

• Headquarters:

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• Approximately 6,500 employees as of December 31, 2021

• Europe's second largest brewer by volume, on a combined basis, within the European countries in which we operate, with an approximate aggregate 18% market share (excluding factored products) in 2020

• Currently operating fourteen primary breweries, seven craft breweries and one cidery

• On January 1, 2020, we changed our management structure and the International segment was reconstituted with the Africa and Asia Pacific businesses reporting into the Europe segment.

Accordingly, the Europe segment operates in Bulgaria, Croatia, Czech Republic, Hungary, Montenegro, the Republic of Ireland, Romania, Serbia, the U.K., various other European countries, and certain countries within the Middle East, Africa and Asia Pacific.

The majority of our European segment sales are in the U.K., Croatia, Czech Republic and Romania.

Our portfolio includes beers that have the largest share in their respective countries, such as Carling in the U.K., Ozujsko in Croatia, Jelen in Serbia and Niksicko in Montenegro.

We have beers that rank in the top three in market share in their respective segments throughout the region, such as Bergenbier in Romania, Kamenitza in Bulgaria and Borsodi in Hungary .

Additionally, we sell Staropramen and Miller Genuine Draft in various European countries.

Our Europe segment includes our consolidated joint venture arrangement for the production and distribution of Cobra brands in the U.K.

and the Republic of Ireland and factored brand sales (beverage brands owned by other companies, but sold and delivered to retail by us).

• Europe's second largest brewer by volume, on a combined basis, within the countries in which we operate, with an approximate aggregate 18% market share (excluding factored products) in 2021.

• Currently operating eleven primary breweries, seven craft breweries and one cidery.

• The EMEA&APAC segment operates in Bulgaria, Croatia, Czech Republic, Hungary, Montenegro, the Republic of Ireland, Romania, Serbia, the U.K., various other European countries, and certain countries within the Middle East, Africa and Asia Pacific.

The majority of our EMEA&APAC segment sales are in the U.K., Croatia, Czech Republic and Romania.

Our portfolio includes beers that have the largest share in their respective countries, such as Carling in the U.K., Ozujsko in Croatia, and Niksicko in Montenegro.

We have beers that rank in the top three in market share in their respective segments throughout the region, such as Bergenbier in Romania, Jelen in Serbia and Borsodi in Hungary .

Additionally, we sell Staropramen and Miller Genuine Draft in various countries.

Our EMEA&APAC segment includes our consolidated joint venture arrangement for the production and distribution of Cobra brands in the U.K.

and factored brand sales (beverage brands owned by other companies but sold and delivered to retail by us).

Sales and Distribution

In Europe, beer is generally distributed through either a two-tier system consisting of manufacturers and retailers, or a three-tier system consisting of manufacturers, distributors and retailers.

In the European countries in which we operate, beer is generally distributed through either a two-tier system consisting of manufacturers and retailers, or a three-tier system consisting of manufacturers, distributors and retailers.

Distribution activities for both the on-premise and off-premise channels are conducted primarily by third-party logistics providers.

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for brewers to distribute beer, wine, spirits, and other products owned and produced by other companies, which we refer to as factored brands, to the on-premise channel (bars and restaurants).

Approximately 9% of our Europe segment net sales in 2020 represented factored brands.

In addition, we have an agreement with Heineken whereby they sell, market and distribute Coors Light in the Republic of Ireland, as well as agreements with ABI to brew and distribute Beck's , Stella Artois , Lowenbrau and Spaten and to distribute Hoegaarden , Leffe , and Corona in Central Europe.

Our operations in Africa, the Middle East and Asia Pacific include markets such as Australia, Japan, South Africa and South Korea, with the sale and distribution completed under local license agreements, or through the import of our brands with sale through local distributors.

In Europe, the on-premise channel includes sales to pubs and restaurants.

Approximately 14% of our EMEA&APAC segment net sales in 2021 represented factored brands.

In addition, we have an agreement with Heineken whereby they sell, market and distribute Coors in the Republic of Ireland, as well as agreements with ABI to brew and distribute Beck's , Stella Artois and Lowenbrau, and to distribute Hoegaarden , Leffe , and Corona in Central Europe.

Our operations in Africa, the Middle East and Asia Pacific include markets such as Australia, South Africa and South Korea, with the sale and distribution completed under local license agreements, or through the import of our brands with sale through local distributors.

In the EMEA&APAC segment, excluding the Middle East, Africa and Asia-Pacific, the on-premise channel includes sales to pubs and restaurants.

The installation and maintenance of draught beer dispensing equipment in the on-premise channel is generally the responsibility of the brewer.

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The off-premise channel includes sales to supermarkets, convenience stores, liquor stores, distributors and wholesalers.

Over the last few years, the off-premise channel has become increasingly concentrated among a small number of super-store chains.

Generally, over the years, industry volumes in Europe have shifted from the higher margin on-premise channel, where products are consumed in pubs and restaurants, to the lower margin off-premise channel, also referred to as the "take-home" market.

Further, we continue to monitor the coronavirus pandemic, which had, and we currently expect will continue to have, a material adverse effect on our Europe results of operations for fiscal years 2020, 2021 and, possibly, beyond.

In 2020, we experienced a significant adverse impact resulting from the closure of the on-premise channel for most of the second and fourth quarters, as a result of the coronavirus pandemic.

Business and consumer behavior in the channel has been uncertain and has not returned to pre-pandemic levels.

As perspective, we estimate that in 2019 approximately 40% and 50%-55% of our Europe volume and net sales, respectively, was from the on-premise channel, which tends to be more profitable than the off-premise channel.

In addition, the U.K.

was further negatively impacted by the on-premise restrictions as the U.K comprises approximately 55% of our Europe net sales, which were $1,986.4 million for the year ended December 31, 2019 (the Europe net sales includes the U.K.

factored brand business, which represented approximately 17% of this amount in 2019), and, we

estimate, nearly 60% and approximately 70-75% of the U.K.

volume and net sales revenue, respectively, in 2019 originated from the U.K.

on-premise channel.

As a result of the coronavirus pandemic and resulting government-imposed restrictions and related on-premise closures, this portion of our business effectively entirely ceased through the first lockdown, from the middle of March of 2020 through early June of 2020 across all of Europe and continuing into early July of 2020 in the U.K., and was mostly closed through the second lockdown in the fourth quarter with different levels of restrictions across countries.

Management's Discussion and Analysis, "Executive Summary" & Results of Operations— "Europe," for further details.

Over the last few years, throughout the EMEA&APAC segment the off-premise channel has become increasingly concentrated among a small number of super-store chains.

Generally, over the years, industry volumes across countries in which we operate in have shifted from the higher-margin on-premise channel, where products are consumed in pubs and restaurants, to the lower-margin off-premise channel, also referred to as the "take-home" market.

The years ended December 31, 2020 and 2021 proved unique as both years were impacted significantly by the coronavirus pandemic.

As perspective, we estimate that in 2019 pre-pandemic levels, approximately 60% and 75% of our U.K.

financial volumes and net sales, respectively, were from the on-premise channel.

comprised approximately 55% of our EMEA&APAC net sales, which were $1,986.4 million for the year ended December 31, 2019.

During the year ended December 31, 2020, we experienced a significant adverse impact resulting from the closure of, or increased restrictions to, the on-premise channel as a result of the on-set of the coronavirus pandemic which effectively shut down the on-premise channel from March 2020 into July 2020 in the U.K., and was mostly closed again as a result of a second lockdown during the fourth quarter of 2020.

For the year-ended December 31, 2020, we estimate approximately 40% and 50%

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financial volumes and net sales, respectively, was from the on-premise channel.

comprised approximately 45% of our EMEA&APAC segment net sales, which were $1,431.9 million for the year ended December 31, 2020.

While on-premise volumes progressively improved throughout 2021 as bars and restaurants reopened with restrictions, due to implications of the new coronavirus variant, consumer behavior in the U.K.

and across Central Europe became more uncertain as individuals were encouraged to work from home and reduce other personal interactions during the fourth quarter of 2021.

For the year-ended December 31, 2021, we estimate that approximately 50% and 65% of our U.K.

financial volumes and net sales, respectively, was from the on-premise channel.

comprised approximately 55% of our EMEA&APAC segment net sales, which were $1,802.3 million for the year ended December 31, 2021.

Although we experienced improvements within the on-premise channel in 2021, business and consumer uncertainty in the channel has persisted, and as a result, we did not see a full return to pre-pandemic levels.

In addition, enhanced restrictions returned in the fourth quarter of 2021 as a result of the risk of coronavirus variants.

Management's Discussion and Analysis, " Items Affective Report ed Results " & Segment Results of Operations— " EMEA & APAC " , for further details of the impact of the coronavirus pandemic on the EMEA&APAC segment.

Manufacturing, Production and Packaging

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We have multiple agreements with various suppliers that cover almost all of our total required malt, with terms ending in 2022 through 2027.

Hops are purchased under various contracts with suppliers in Germany, Czech Republic, Slovenia, U.S.

and the U.K., which contribute to our anticipated requirements through 2025 in line with our planned supply coverage strategy.

Hops are purchased under various contracts with suppliers in Germany, Czech Republic and Slovenia, which contribute to our anticipated requirements through 2026 in line with our planned supply coverage strategy.

Adjuncts are purchased under various contracts with local producers, which are typically crop year contracts commencing in October of each year.

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Packaging Materials

The following summarizes the percentage of our Europe segment's packaging materials by type for the year ended December 31, 2020.

The below chart shows a meaningful shift to aluminum cans, largely as a result of changes in consumer behavior throughout the coronavirus pandemic.

In fiscal year 2019, aluminum cans made up 28% of packaging materials in our Europe segment.

• A significant majority of glass returnable bottles are sourced under various agreements with third-party suppliers.

The following summarizes the percentage of packaging materials by type for the largest region of our EMEA&APAC segment for the year ended December 31, 2021.

In recent years, we have seen a shift to aluminum cans from kegs as industry volumes in Europe have shifted from on-premise to off-premise and this trend accelerated during the year ended December 31, 2020 as a result of the on-premise channel closing at various degrees for most of the second and fourth quarters.

While we have seen a shift back from aluminum cans to kegs during the year ended December 31, 2021 as a result of the on-premise progressively reopening, aluminum cans continue to represent a greater percentage of packaging materials in the EMEA&APAC segment as compared to years prior to the coronavirus pandemic.

Aluminum cans or bottles

• We have long-term agreements with various suppliers that cover all of our required supply of cans, with terms ending in 2023 through 2026.

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Glass bottles

• Our glass returnable bottles are sourced under various agreements with third-party suppliers.

Kegs and casks

• A limited number of kegs are purchased each year from various suppliers, and we have no long-term supply commitment.

We are currently in the process of signing new agreements which would cover all of our requirements for kegs in 2022.

• We have long-term agreements with various suppliers that cover all of our required supply of cans, with terms ending in 2021 through 2023.

Recyclable plastic containers

• We have multiple agreements with various manufacturers in the region, covering 100% of our requirements, which expire in 2024.

We do not currently anticipate any issues in renegotiating and extending these contracts or in otherwise being able to access recyclable plastic containers.

We signed a new agreement that expires in 2025 and the rest of our agreements are in renegotiations.

We do not currently anticipate an issue in renegotiating and extending the remaining contracts or otherwise being able to access recyclable plastic containers.

Crowns, labels and corrugate are purchased from sources unique to each category.

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Seasonality of Business

In Europe, the beer industry is subject to seasonal sales fluctuations primarily influenced by holidays, weather and by certain major televised sporting events.

In our EMEA&APAC segment, the beer industry is subject to seasonal sales fluctuations primarily influenced by holidays, weather and by certain major televised sporting events.

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Known Trends and Competitive Conditions

2020 Europe Beer Industry Overview

Europe beer industry retail shipments have fluctuated by approximately 1% to 2% annually over the last five years.

These market fluctuations are consistent with the fluctuations within the overall alcohol market in each of the respective years.

Since 2010 to 2019, the off-premise market share has increased in our European markets from 55% to nearly 60% of total volume, and the on-premise market share has declined from 45% to around 40%.

In 2020, the beer market was significantly impacted by the coronavirus pandemic resulting in full or partial closure of on-trade for the last nine months of the year.

Based on current data, we estimate an on-premise market decline in the high single digits in 2020.

We also estimate in 2020 that the on-premise share in the market was heavily impacted, declining to approximately 20% share from around 40% share in 2019.

2021 Beer Industry Overview

Our beers compete not only with similar products from competitors, but also with other alcohol beverages, including wines and spirits.

The following table summarizes the estimated percentage market share by volume of beer and other alcohol beverages, including wine and spirits, as a component of the overall European alcohol market, within the countries in which we have production facilities, over the last five years, for which data is currently available.

As the global economy continues to recover from the impacts of the coronavirus pandemic, continued restrictions to the on-premise channel, if prolonged in nature, will continue to impact the beer industry in the EMEA&APAC regions.

The following table summarizes the estimated percentage market share by volume of beer and other alcohol beverages, including wine and spirits, as a component of the overall alcohol market, within the countries in which we have production facilities, over the last five years, for which data is currently available.

We anticipate that 2021 data, when available, will reflect a continuation of the recent consumer trends.

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Our Competitive Position

In European countries where we currently operate, our primary competitors are Heineken, Asahi, ABI and Carlsberg.

In the European countries where we currently operate, our primary competitors are ABI, Asahi, Carlsberg and Heineken.

We believe our brand portfolio gives us strong representation in all major beer categories.

The following table summarizes our estimated percentage share of the beer market within the European countries where we operate and our primary competitors over the last five years.

The following table summarizes our estimated percentage share of the beer market within the countries where we operate and our primary competitors over the last five years.

Current year percentages reflect estimates based on market data currently available.

Prior year percentages reflect the market data available subsequent to the filing of the prior year annual report.

2021 2020 2019 2018 2017

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Others' share 18 % 19 % 21 % 23 % 24 %

Each country that is part of our Europe segment where we carry out significant brewing or distribution activities is either a member of the European Union ("EU") or a current candidate to join, with the exception of the U.K., which left the EU during 2020, Bosnia which is a potential EU candidate and India which is part of the Asia Pacific.

As such, there are similarities in the regulations that apply to many parts of our Europe segment's operations and products, including brewing, food safety, labeling and packaging, marketing and advertising, environmental, health and safety, employment and data protection regulations.

To operate breweries and conduct our business in Europe, we must obtain and maintain numerous permits and licenses from various governmental agencies.

exited the EU on January 31, 2020 and entered a twelve month transition period.

On December 24, 2020, the deal laying out the future relationship between the U.K.

and EU was agreed, and subsequently endorsed on December 30, 2020.

The treaty became effective on January 1, 2021.

left the single market and customs union on December 31, 2020, the deal guarantees "zero tariff and zero quota" trade on goods.

See Part I—Item 1A Risk Factors under "Risks Specific to the Europe Segment" for further discussion of the risks specific to the U.K.'s exit from the EU.

Each country's government levies excise taxes on alcohol beverages.

Each country that is part of our EMEA&APAC segment where we carry out significant brewing or distribution activities is either a member of the European Union ("EU") or a current candidate to join, with the exception of the U.K., which left the EU during 2020, and Bosnia, Montenegro and Serbia which are potential EU candidates.

As such, there are similarities in the

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regulations that apply to many parts of our EMEA&APAC segment's operations and products, including brewing, food safety, labeling and packaging, marketing and advertising, environmental, health and safety, employment and data protection regulations.

To operate breweries and conduct our business in these countries, we must obtain and maintain numerous permits and licenses from various governmental agencies.

The government(s) of each country in which we sell our products levies excise taxes on alcohol beverages.

EU member countries' laws on excise taxes are consistent with the EU Directives and use the same measurements based on either alcohol by volume or Plato degrees.

Non-EU countries use various taxation methods, including flat excise rate per volume or methods that may be similar to those used in the EU.

In 2020, the excise taxes for our Europe segment were approximately $41 per hectoliter on a reported basis.

Refer to Part I—Item 1A, Risk Factors for risks associated with the regulatory environment in Europe.

In the year ended December 31, 2021, the excise taxes for our EMEA&APAC segment were approximately $45 per hectoliter on a reported basis.

Refer to Part I—Item 1A .

Risk Factors for risks associated with the regulatory environment in EMEA&APAC.

We have certain activity that is not allocated to our segments, and primarily includes financing-related costs such as interest expense and income, foreign exchange gains and losses on intercompany balances related to financing and other treasury-related activities, and the unrealized changes in fair value on our commodity swaps not designated in hedging relationships recorded within cost of goods sold, which are later reclassified when realized to the segment in which the underlying exposure resides.

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Other Information

Environmental Matters

Our operations are subject to a variety of extensive and changing federal, state and local environmental laws, regulations and ordinances that govern activities or operations that may have an impact on human health or the environment.

Such laws, regulations or ordinances may impose liability for the cost of remediation, and for certain damages resulting from sites of past releases of hazardous materials.

Our policy is to comply with all such legal requirements.

While we cannot predict our eventual aggregate cost for the environmental and related matters in which we may be or are currently involved, we believe that any payments, if required, for these matters would be made over a period of time in amounts that would not be material in any one year to our operating results, cash flows, or our financial or competitive position.

We believe adequate reserves have been provided for losses that are probable and estimable.

However, there can be no assurance that environmental laws will not become more stringent in the future or that we will not incur material costs in the future in order to comply with such laws.

See Part II—Item 8 Financial Statements and Supplementary Data, Note 18, "Commitments and Contingencies" under the caption " Environmental" for additional information regarding environmental matters.

Global Intellectual Property

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Sustainability

We believe in producing a beer we can be proud of, from grain to glass.

Our Imprint (formerly known as Our Beer Print ) is MCBC's approach to sustainability and the right way to grow our business for a better tomorrow.

Our Imprint is integral to how we will build long-term value for society and our shareholders, while leaving a positive imprint on our communities, on our environment and on our business.

We have a long legacy of leaving a positive imprint on the environment and our communities.

We believe in producing beverages we can be proud of, from grain to glass.

Our Imprint is MCBC's approach to sustainability and the right way to grow our business for a better tomorrow.

Our Imprint is integral to how we will build long-term value for society and our shareholders, while leaving a positive imprint on our communities, on our people and planet.

We have a long legacy of commitment to sustainability.

In 2012, MCBC became a charter member of the International Alliance for Responsible Drinking ("IARD").

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IARD works with governments globally to support the WHO NCD Global Monitoring Framework target of 10% reduction in harmful use of alcohol by 2025.

In 2017, we launched Our Imprint 2025 agenda, a new sustainability strategy for MCBC and a set of ambitious goals to take us to 2025.

We focused our efforts where we can have the most positive impact on our business and society.

We established goals across three pillars - Responsibly Refreshing, Sustainable Brewing and Collectively Crafted - that aim to address the expectations of our consumers and stakeholders, while we continue to make our operations even more resource efficient and resilient.

In 2019, we added new global packaging goals to our 2025 agenda, aiming for 100% of our packaging to be reusable, recyclable or compostable.

We are also strengthening our goals to drive down packaging emissions, use more recycled materials in our plastic packaging and improve recycling solutions in our key markets by 2025.

In 2017, we launched Our Imprint 2025 agenda, which included a set of ambitious goals across a range of matters relating to environmental sustainability and community and people.

We further added to these goals in 2019, incorporating our ambition to make our packaging more sustainable.

These goals include our commitment to use more recycled materials in our plastic packaging, improve recycling solutions in our key markets and make 100% of our packaging reusable, recyclable or compostable by 2025.

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In 2021, we added a new target to increase diverse representation in our company by 2023 and streamlined Our Imprint 2025 strategy to reflect our four priority focus areas.

The four areas where we believe we can make the greatest contribution and demonstrate leadership include:

diversity, equity and inclusion ("DEI"), water, climate and packaging.

The enhanced focus areas aim to address the expectations of our consumers and stakeholders, while we continue to make our operations even more resource efficient and resilient.

More information about Our Imprint 2025 goals can be found on our sustainability website, www.MolsonCoorsOurImprint.com, which includes:

• Our Imprint Report 2020, which presents the most recent progress made against our 2025 goals;

• ESG (Environment, Social and Governance) Report 2020, which includes more details on the underlying data, processes and policies that support ESG topics;

• SDG (Sustainability Development Goals) Impact Report 2020, which shows how MCBC is taking action to contribute to the 17 global goals set forth by the United Nations by 2030.

• Environmental, Social and Governance Report 2021, which presents the most recent progress made against our certain goals and includes more details on the underlying data, processes and policies that support ESG topics;

• Sustainable Development Goals Impact Report 2021, which shows how MCBC is taking action to contribute to the 17 global goals set forth by the United Nations by 2030.

The information provided on our website (or any other website referred to in this report) is not part of this report and is not incorporated by reference as part of this report.

Environmental Matters

Such laws, regulations or ordinances may impose liability for the cost of remediation, and for certain damages resulting from sites of past releases of hazardous materials.

Our policy is to comply with all such legal requirements.

We believe adequate reserves have been provided for losses that are probable and estimable.

However, there can be no assurance that environmental laws will not become more stringent in the future or that we will not incur material costs in the future in order to comply with such laws.

Human Capital Management

We have a global and varied workforce, with major employee centers in the U.S., Canada, U.K.

As of the end of 2020, we employed approximately 17,000 employees within our business globally with approximately 10,000 within our North America segment and 7,000 within our Europe segment.

Of the 17,000 employees, approximately 660 of our employees are in our Global Business Centers based in Milwaukee, Wisconsin and Bucharest, Romania.

As of the end of 2020, approximately 33% and 29% of our North America and Europe workforces, respectively, are represented by trade unions or councils, which are subject to collective bargaining agreements, which come due for renegotiation from time to time.

The Company strives to be a provider of meaningful experiences for its employees and a safe and healthy workplace for all employees.

We believe that building a strong and diverse workforce is a significant contributor to our success as a business and to deliver on our purpose, and that we value and respect our differences.

We believe that diversity with inclusion is the key to collaboration and a winning team culture.

A significant component of the revitalization plan announced in October 2019 was the launch of a refreshed purpose (uniting people to celebrate all life’s moments), ambition (first choice for our people, consumers and customers) and shared company values (the first of which is Putting People First), all designed with a purpose of shifting the culture of the organization to drive stronger employee engagement and business engagement.

With the overarching goals described in the preceding paragraph as guides, the leadership team and the chief people and diversity officers for the North America and Europe business units are tasked with managing all employment-related matters including recruitment, retention, leadership and development, compensation planning, succession planning, performance management, and diversity and inclusion.

The Compensation Human Resource Committee of the Board of Directors is responsible for establishing and reviewing the overall compensation philosophy of the Company and providing oversight on certain human capital matters, including the Company’s talent retention and development, leadership development, talent pipeline, programs and systems for performance management and diversity and inclusion initiatives.

The Audit Committee oversees the Company’s risk management program to identify and mitigate potential risks, including human capital issues.

The Board of Directors then receives regular reports and recommendations from management and the board committees to help guide the Company’s strategy on retaining and developing a diverse and talented workforce.

In North America, we promote and maintain employee resource groups for a number of different communities in our employee population - by race/ethnicity, by gender, LGBTQ+, early professionals, young families, and veterans, amongst others.

We have a global and varied workforce, with major employee centers in the U.S., Canada, the U.K.

As of the end of 2021, we employed approximately 16,300 employees within our business globally with approximately 9,800 within our Americas segment and 6,500 within our EMEA&APAC segment.

Of the approximately 16,300 employees, approximately 600 of our employees are in our Global Business Services Centers based in Milwaukee, Wisconsin and Bucharest, Romania.

As of the end of 2021, approximately 32% and 26% of our Americas segment and EMEA&APAC segment workforces, respectively, are represented by trade unions or councils, which are subject to collective bargaining agreements, which come due for renegotiation from time to time.

Our People-First Culture

We believe that people are the heart of our Company.

We strive to create a culture where people are encouraged to and feel comfortable about bringing their diverse perspectives and experiences to the table.

As a global company, we believe we have a responsibility to nurture a workforce that reflects our local communities.

We believe this makes us a better employer, partner and company of choice for our consumers and customers, and it is why we are committed to championing DEI.

We strive to be a provider of meaningful experiences for our employees and a safe and healthy workplace for all employees.

We believe that building a diverse and inclusive workforce is a significant contributor to our success as a business and to deliver on our purpose, and that we value and respect our differences.

We believe that diversity and equity with inclusion is the key to collaboration and a winning team culture.

In addition, we refreshed and stream-lined our ESG strategy in 2021 to further focus on areas in which we believe we can have the biggest impact, including a focus on people.

More information about our ESG strategy can be found in our ESG Report, located on our sustainability website, www.MolsonCoorsOurImprint.com.

The information provided on our website (or any other website referred to in this report) is not part of this report and is not incorporated by reference as part of this report.

Board and Management Oversight

With the overarching goals described in the preceding paragraph as guides, the leadership team and the chief people and diversity officers for the Americas and EMEA&APAC segments are tasked with managing all employment-related matters including recruitment, retention, leadership and development, compensation planning, succession planning, performance management, and DEI.

The Compensation and Human Resource Committee ("CHR Committee") of the Board of Directors is responsible for establishing and reviewing the overall compensation philosophy of our Company and providing oversight on certain human capital matters, including our talent retention and development, leadership development, talent pipeline, programs and systems for performance management and DEI initiatives.

Further, the CHR Committee is responsible for overseeing our progress against our social initiatives related to human capital management.

The Audit Committee oversees our ESG and sustainability programs and reporting, as well as its enterprise risk management program to identify and mitigate potential risks, including human capital issues.

The Board of Directors receives regular reports and recommendations from management and the board committees to help guide our strategy on retaining and developing a diverse and talented workforce.

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Diversity, Equity and Inclusion

We believe DEI should be deeply embedded in our corporate culture and how we operate, from how we work together to how we grow as a company.

In 2020, we created a new position of Vice President of Diversity, Equity & Inclusion to help ensure we have a robust DEI strategy.

We accelerated our DEI efforts by creating a three-year DEI roadmap and action plan for the U.S.

and Canada as a result of an assessment of our existing culture, programs and talent management processes.

We identified the strengths and opportunities for improvement in our corporate culture through discussions with Company executives and senior leaders, our focus groups and our employees.

In order to further increase awareness around DEI issues, we launched a Month of Inclusion in 2021, which builds on the Week of Inclusion we introduced in 2020.

The Month of Inclusion brings together our U.S.

and Canada employees, and our Western Europe employees, respectively, to focus on prioritizing inclusion, equity and workplace respect.

This year’s Month of Inclusion included a variety of presentations, interactive sessions and fireside chats with leaders and external experts that were centered around our five corporate values and designed to be conversation starters to help facilitate potentially difficult discussions.

We promote and maintain employee resource groups ("ERGs") for a number of different communities in our employee population - by race/ethnicity, by gender, LGBTQ+, early professionals, young families, and veterans, amongst others.

These ERGs are aimed to help foster a diverse, inclusive workplace aligned with our values and culture.

We encourage participation in these groups as we believe it provides an open forum for individual employees who may share similar concerns or experiences.

We also rely on these ERGs to help activate our DEI strategy through community building and creating a culture of allyship.

and Canada, the ERGs host monthly Inclusion in Action events on different topics helping employees build knowledge, broaden perspective and develop meaningful understanding of various viewpoints.

In addition, as part of our wider DEI strategy, an Inclusion & Diversity Director, EMEA&APAC, was appointed in 2021.

In EMEA&APAC, over 5,500 employees completed a Respect at Work learning module and over 500 leaders completed an Inclusive Leader training program.

We believe these actions underline our commitment to accelerating our DEI efforts to help build an inclusive culture where our people feel accepted and valued.

As we work to a more diverse workforce and management team, we developed programs to encourage the recruitment, retention and training of diverse leaders and working to ensure we have a highly skilled and diverse workforce.

Talent Development

We encourage our employees to develop their careers and learn every day and have embedded that belief in our core company values as “Learn Every Day.” Our aim is to help employees unlock their full potential so they can thrive in their current job and also realize new, potential growth opportunities.

In 2021, we launched a new talent planning experience, which is designed to help us understand our employee’s ambitions and identify growth opportunities that fit their needs, as well as the needs of our Company.

We also promote and emphasize leadership and development opportunities for our employees which includes our First Choice Learning Center, in-person and online training programs, and experiential training opportunities to encourage and promote employee health and safety, assist in building core competencies, learning best practices and developing leadership capabilities.

As we work to a more diverse workforce and management team, the Company has developed programs to encourage the recruitment, retention and training of diverse leaders and working to ensure we have a highly skilled and diverse workforce.

We track and monitor our progress on metrics of gender and race, particularly in the U.S., though data on race is not tracked in all jurisdictions.

In addition, employee performance is assessed at year-end based on achievement of individual goals and the degree to which our values are modeled to achieve them.

Compensation and Benefits

We offer competitive, affordable and comprehensive benefits.

We recognize excellence and differentiate rewards based on both what we do and how we do it – which we intend to be equally weighted to help strengthen our culture and promote our Company as a great place to work while at the same achieving our business results.

We believe these compensation rewards motivate us to be bold and decisive and ignite growth.

Our incentive programs hold us accountable for living out our values to achieve our short- and long-term goals.

Our employees are able to participate in our Total Rewards program that in general provides a competitive base salary, incentive plans, health, dental, and vision insurance plans, a 401(k) option in certain regions with a potential employer match, paid time off plans, including parental leave policies in many locations, an engaging Wellness Program and an Employee Assistance Program.

Our business units comply with applicable maternity leave laws and, in many countries, we go further to provide flexible work schedules and extended leave for new parents.

We routinely benchmark our global compensation and benefits programs to ensure they are competitive, inclusive, aligned with our company culture and allow our employees to meet their individual needs and the needs of their families.

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Engaging Our Employees

We believe that engaging our employees, through surveys during the onboarding process and throughout the employee journey, provides us with valuable insight into how we can develop our company culture to help ensure that our people feel supported and able to thrive at our company.

We use a “continuous listening” model to try to ensure that we understand how our employees are feeling and what they are thinking throughout the year.

We gauge our employees’ sentiments through a quarterly Employee Experience survey in the U.S.

and Canada and bi-annual surveys in EMEA&APAC.

These surveys focus on topics such as our culture, values, DEI efforts, well-being and leadership.

In addition, our CEO regularly hosts live online question and answer sessions available to all employees.

We believe these sessions also help create a company culture where open, honest dialogue is supported and encouraged, and where people are empowered to raise questions and concerns about our business and our culture.

Employee Health and Safety

We aim to ensure that our employees have a healthy and safe work environment.

Our supply chain has adopted and implemented a framework we call world class supply chain 2.0 at many of our brewery and other locations.

As part of that framework, the Company's environment, health and safety policy guides the Company’s efforts in maintaining safe and healthy workplaces where we take a proactive approach to the identification and control of environment, health and safety risks.

We work to improve our Environment, Health and Safety ("EHS") performance through methodologies that aim to prevent workplace injuries and illness, and reduce environmental impacts of our operations.

Our safety focus was evident during our response to the coronavirus pandemic where we implemented additional health and safety measures in the breweries and our distribution centers, ensuring these federally designated essential operations could continue to operate and we could protect our

We enhanced our cleaning protocols at the majority of our facilities including enhanced sanitization, social distancing, temperature screenings, cloth facemasks and hand sanitizers, instituted a paid leave coronavirus policy and program, adopted a voluntary unpaid leave program, and expanded access to virtual healthcare, remote fitness and wellness support and to our employee assistance program.

As part of that framework, our environment, health and safety ("EHS") policy guides our efforts in maintaining safe and healthy workplaces where we take a proactive approach to the identification and control of environment, health and safety risks.

We develop our safety programs to promote a sense of ownership for personal safety and safety of colleagues at all levels of the business.

We work to improve our EHS performance through training and other methodologies that aim to prevent workplace injuries and illness, and reduce environmental impacts of our operations.

Our safety focus was further evident during our response to the coronavirus pandemic where we implemented additional health and safety measures in the breweries and our distribution centers, ensuring these federally designated essential operations could continue to operate and we could protect our employees.

We enhanced our cleaning protocols at the majority of our facilities including enhanced sanitization, social distancing, cloth facemasks and hand sanitizers, and for a period of time, instituted paid and unpaid coronavirus specific leave programs.

Promoting Employee Well-Being

We promote healthy lifestyles across our global enterprise by offering health benefits, wellness and work/life balance programs that are tailored to employees' needs and culture by work location.

and Canada, employees can participate in our wellness programs through a mobile phone application that incentivizes healthy habits and lifestyles.

The need for remote work and social distancing has changed the dynamics of the workplace so we have responded by providing resources to help support not only the physical health of our employees, but also their mental health and well-being.

These resources include connections to virtual healthcare, remote fitness and wellness support, and a free employee assistance program for coping with stress, feelings of isolation and anxiety.

Available Information

8 unchanged sentences

Joubert 55 Chief Financial Officer

Cox 53 President and Chief Executive Officer, Molson Coors Europe

Sergey Yeskov 45 Chief Executive Officer of Molson Coors EMEA&APAC

Marino 49 President, Emerging Growth

Lee Reichert 54 Chief Legal and Government Affairs Officer

Anne-Marie Wieland D'Angelo 45 Chief Legal and Government Affairs Officer

Jacques 44 Chief Marketing Officer

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business