part two

The Company's effective tax rate during the third quarter 2009 for income from continuing operations was 9 percent on a reported basis and 4 percent on an underlying basis. The Company estimates that its full-year 2009 underlying effective tax rate will be in the range of negative 2 percent to positive 2 percent. These tax rates are significantly lower than the Company's anticipated long-term tax rate range of 22 percent to 26 percent due to the favorable resolution of unrecognized tax positions during 2009.


During the quarter, Molson Coors achieved an incremental $18 million of cost savings as part of its three-year, $250 million Resources for Growth (RFG) cost savings program. Savings from the RFG program now total $246 million.


MillerCoors achieved $73 million in synergies in the third quarter, largely due to marketing synergies, as well as organizational savings resulting from the elimination of duplicate and transitional positions in the third quarter 2008. Molson Coors' 42 percent share of these synergies is $31 million. Network optimization savings continue to be realized from shifting production of Coors and Miller brands into the larger MillerCoors brewery network, a process which will continue for the next nine months. MillerCoors continues to integrate business processes and systems across the enterprise to deliver enhanced customer solutions and better leverage the scale of the business.


MillerCoors has delivered $183 million in synergies this year, bringing the total to $211 million since beginning operations on July 1, 2008. The Company now expects to achieve $270 million of cumulative synergies by the end of 2009, surpassing its original commitment of $225 million. As previously communicated, MillerCoors will deliver incremental cost savings above the $500 million synergy target, and approximately $200 million in cost savings are expected to be delivered by the end of 2012, approximately in-line with current market expectations. These cost savings include efficiencies in production costs, procurement, and marketing, general and administrative expense.


Molson Coors Brewing Company's total worldwide beer volume was 13.8 million hectoliters in the quarter, 2.9 percent lower versus the prior year, as shown in Table 1 below.