Good morning, and welcome to the Molson Coors Beverage Company Fourth Quarter and 2024 Fiscal Year Earnings Conference Call. With that, I'll hand it over to Greg Tierney, Vice President, FP&A and Commercial Finance.
Thank you, operator, and hello, everyone. Following prepared remarks today, we look forward to taking your questions. (Event Instructions) Also, I encourage you to review our earnings release and earnings slides, which are posted to the IR section of our website and provide detailed financial and operational metrics.
Today's discussion includes forward-looking statements -- actual results or could differ materially from our forecast. For more information, please refer to the risk factors discussed in our most recent filings with the SEC. We assume no obligation to update forward-looking statements except as required by applicable law. The definitions of or reconciliations for any non-US GAAP measures are included in our earnings release.
Unless otherwise indicated, all financial results we discuss are versus the comparable prior year period and are in US dollars. With the exception of earnings per share, all financial metrics are in constant currency when referencing percentage changes from the prior year period. Also, shared data references are sourced from Sircana in the US and from Beer Canada in Canada, unless otherwise indicated.
Further, in our remarks today, we will reference underlying pretax income which equates to underlying income before income taxes and underlying earnings per share, which equates to underlying diluted earnings per share as defined in our earnings release. With that, over to you, Gavin.
Thank you, Greg. Hello, everybody, and thank you for joining the call. 2024 was another year of progress for Molson Coors, progress in advancing our strategy and achieving bottom line growth. And with a challenging macroeconomic environment, we continue to support the health of our brands globally. We retained a substantial portion of our sizable share gains from 2023 and earned unprecedented levels of shelf space for our core power brands in the US.
We achieved incredible growth in Canada, broadly across all price segments of our portfolio. We continue to premiumize off a high base in our EMEA and APAC business. We terminated low-margin contract brewing agreement and exited smaller unprofitable businesses while investing in areas that we expect will drive long-term sustainable profitable growth. 2024 was also another year of continued strong cash generation that contributed to earnings power.
We delivered more than $1.2 billion in underlying free cash flow which, combined with our healthy balance sheet, enabled us to not only invest in our business, but also to return $1 billion in cash to shareholders through a growing dividend and share repurchases. We enter this year confident Issuing 2025 guidance that both reflects the favorable fundamentals of our business, and it aligns with our long-term growth algorithm.
Now with that high-level summary, let's get into some of the details. In the fourth quarter, consolidated net sales revenue was down 1.9%. Underlying pretax income was down 0.9% and underlying earnings per share was up 9.2%. In our Americas business, Canada continued to perform strongly, while as expected, the US faced a temporary headwind related to the exit of PEPS contract out, which was a headwind of about 450,000 (inaudible)
US brand volume was down 3% in the quarter, which improved as compared to the third quarter as did the industry with a moderating of the more pronounced value-seeking behavior seen during the summer. These drivers contributed to a 6.7% decline in US financial volume. Related to the deliberate inventory build in the first half of the year, US shipments trailed brand volumes by approximately 150,000 hectoliters in the quarter, resulting in largely shipping to consumption for the full year as intended.
In the (inaudible) our volumes were impacted by the continued heightened competitive landscape in the UK as well as a softer industry in Central and Eastern Europe. However, this was largely offset by strong net sales revenue barely to growth of 7.8%, driven by favorable sales mix, including continued premiumization and pricing. This along with favorable net pricing growth in the Americas and mixed benefits from the exit of PEPS resulted in consolidated net sales revenue per hectoliter growth of 4.8% for the quarter.
For the year, consolidated net sales revenue was down 0.6%. Underlying pretax income was up 5.6% and underlying earnings per share was up 9.8%. Results were better than our revised top line guidance of down approximately 1% due to better-than-expected US industry performance in the fourth quarter. As a reminder, our 2024 top line guidance was revised lower when we reported our third quarter results in early November due to macro-driven US industry softness in the peak season months of July and August.
It's also important to point out that excluding the impact of the wind down of PEPs contract brewing volume, our implied annual top line revenue growth was positive and in alignment with our long-term growth algorithm. In our volume perspective, pabst a negative 3 percentage point impact on Americas financial volume for the year. Again, while this is a current volume headwind, the reduction of this contract growing volume is expected to have a positive impact in 2025 and beyond on our brewery net effectiveness as well as on mix and margin.
And in what we expect will provide further benefits. We no longer contract grew from the (inaudible) in Canada with ad volume fully exiting our Canadian business as of year-end 2024. Tracey will share more on the impact of that. Consolidated underlying pretax income was above the midpoint of our reaffirmed mid-single-digit growth guidance. This was achieved due to the better-than-expected top line as well as measured cost controls without sacrificing the right levels of brand marketing support.
In addition to added net sales revenue performance, we significantly exceeded our reaffirmed mid-single-digit underlying earnings per share growth guidance, which we had narrowed to the high end of the range in early November. The beat was largely supported by a lower-than-expected underlying effective tax rate due to US geographic sales mix as well as the better-than-expected top line performance in the fourth quarter.
Our underlying earnings per share growth was also supported by our share repurchases, which have been tracking at an accelerated pace as we continue to view our valuation is compelling given our confidence in our business and in our long-term growth (inaudible) in fact, for the first 5 quarters since the share repurchase program was announced, we had already executed approximately 40% under this up to 5-year program, which if you straight line that number would have us at only 25%.
Our confidence stems from our progress against our strategic priorities. I'll start with our core power brands. Collectively, they remain healthy. In the US, Coors Light (inaudible) have continued to retain a substantial portion of our share gains, demonstrating the stickiness of these step change gains. In the fourth quarter, they retained over 80% of their combined volume share gains on a 2-year stack, which is an improvement from both the second and third quarters.
When compared to the fourth quarter of 2022, these brands were up 1.7 share points. Coors banquet continued to perform very well, brand volume up 16% and growing industry share for the 14th consecutive quarter on top of significant prior year gains. Banquet was the fastest-growing top 15 beer brand in the US in terms of volume percentage growth in 2024. And it's not a small brand. In fact, it's one of our top 5 brands globally.
We see much more opportunity ahead as we invest in building the brand's awareness, its national scale and loyal consumer base, particularly among new Gen Z and millennial legal drinking age consumers. In Canada, Coors Light remains the number 1 light beer in the industry and again, grew share of segment in the fourth quarter. The Molson family of brands also gained volume share for both the fourth quarter and the year.
This performance has helped us to drive 23 consecutive months of share growth despite the challenging industry backdrop. In EMEA and APAC, a number of our core power brands are leaders in their respective markets. Carling remains a top later in the UK with strong brand equity. And with the highly competitive environment, we took a value over volume approach, which weighed on volume performance during the year.
And while core brand performance was impacted by the soft industry in the fourth quarter in Central and Eastern Europe, our results were strong for the year.
This was driven by [Jusco] and Croatia, which increased as well as the extremely successful relaunch of Caraiman in Romania. Caraiman has already reached over 300,000 hectoliters since March and has been incremental to the overall portfolio in the country. Turning to our premiumization priority for both beer and beyond beer. Our above premium portfolio was 27% of total net brand revenue for the year.
In EMEA and APAC, where over half of our net brand revenue comes below premium. Our business continued to premiumize. (inaudible) and APAC premiumization success has been driven by Madri which grew net sales revenue double digits in the year and is the number 2 lager in the on-premise in the UK in terms of value. (inaudible) is also exceeding expectations in Bulgaria following a very successful launch there last year, in the Americas, our Above Premium share of net brand revenue was 22% for the year.
This was supported by Canada, which also continued to premise with its above premium net brand revenue up at double digits in 2024. The -- this was driven by the success of Miller Lite, which is the fastest-growing major beer brand in this market on a percentage basis as well as by our flavor portfolio. We are growing more share of flavor than any other major brewer in Canada and Madri is also performing ahead of expectations in Canada following last year's launch.
In the US, there is work to do, but we see this as an opportunity, and we have big plans in 2025. After further fine-tuning our portfolio last year, including divesting underperforming craft breweries, our resources are focused on scalable opportunities within our expanding above premium portfolio brands in both beer and beyond beer.
In beer, we are moving in the right direction with the Blue Moon brand family as we are starting to see signs of stability. In fact, the Blue Moon brand family held share of industry in both the third and fourth quarters and took share of craft during both periods. This includes positive momentum behind some of our newer innovations like the repositioned Blue Moon Light as well as Blue Moon non-alc, which has quickly become a top 10 non-alc brand. And we have plans to build on these results for the Blue min brand family in 2025. And we are betting big on Peroni.
As we have discussed, we have onshore production, which offers a number of benefits. It significantly improves consistency and certainty of supply, which has previously been a challenge when we tried to scale the brand.
It allows us to introduce different pack sizes, which consumers are asking for and it also unlocks meaningful cost savings, which we intend to deploy toward increasing distribution and awareness to drive scale and margin for this brand. Our commercial plans kick off in the second quarter and while it will, of course, take time, ultimately, we see no reason why Peroni really can't rival the size of other major European imports in the US over time.
In Beyond Beer, which is a big part of our premiumization plans, non-ALC is a key focus area. It provides us the opportunity to capture more occasions, particularly among younger legal age Gen Z consumers. So we are investing behind the growing areas in non Alc where we believe we have a right to win. This too will take some time, but we are making progress. We spoke in detail on our last quarter call about our increased investment in ZOA to a majority stake and plans to accelerate the brand are well underway.
It's early days of the integration. But in the last 4 weeks to end the year, ZOA grew in both dollar and unit share in total US Food. Taking this increased stake allows us to lead the entirety of the brand's marketing, retail and direct-to-consumer sales development as we drive brand awareness and distribution, leveraging the strength of our network. And speaking of opportunities to advance our non-op plans, we are so pleased to have entered into a strategic partnership agreement with the world's leading supplier of premium carbonated mixes.
The partnership agreement gives us the exclusive commercialization rights to the [Fevertree] brand in the US. This is a significant step forward in our strategic ambition to build a total beverage portfolio for a wide range of consumer preferences across both traditional alcohol and non-ALC occasions. Now before I pass it to Tracey, I'll conclude by saying that we remain confident we have the right strategy to achieve our long-term growth objectives.
And our 2025 guidance is aligned with those objectives. Collectively, our global core power brands are healthy, and we have great commercial plans in 2025 to continue to support it. We are changing the shape of our global portfolio with premiumization successes in EMEA at APAC and Canada, and we have targeted plans for the US. Our operations outside of the US are performing well and contributing meaningfully to our growth.
Our capabilities across our organization support premiumization and focused innovation, supply chain efficiencies and commercial effectiveness, which helped drive sustained long-term profitable growth. And with our compelling cash generation and a healthy balance sheet, we have substantially improved our financial flexibility, allowing us to continue to invest in our business and return cash to shareholders.
So we are pleased with our progress and confidence in our ability to achieve our long-term growth algorithm in 2025 and beyond. With that, I will pass it to Tracey.
Tracey Joubert
Thank you, Gavin. We made strong progress in enhancing our profitability and financial flexibility in 2024. We delivered over $1.2 billion in underlying free cash flow, in line with our expectations. It was supported by underlying pretax income margin expansion of nearly 80 basis points for the year.
This expansion was driven by positive net pricing, mix impact moderating inflation and cost savings, which more than offset volume deleverage, which had a particularly significant impact in the second half of the year related to US shipment timing. Also contributing to the margin improvement was lower NG&A, largely due to cycling innovative levels in 2023. G&A declines were mostly related to higher incentive compensation in 2023.
Marketing declines were mainly a result of higher investments in the prior year, particularly in the second half of the year when we increased spend by an incremental $100 million, given the accelerated demand in the US. But importantly, we continue to support our brands globally with higher levels of marketing investments for both the quarter and the year as compared to the respective periods in 2022.
In addition to investing in our brands and business, we continue to return cash to shareholders. In 2024, we paid $369 million in cash dividends and $643 million to repurchase 10.9 million shares. Since the plan was announced in October 2023, we have repurchased 6.7% of our Class B shares outstanding. It's an up to 5-year $2 billion plan.
And as Gavin mentioned, we have utilized approximately 40% in just the first 5 quarters. We ended the year with a healthy balance sheet and our net debt to underlying EBITDA ratio was 2.1x, which is in line with our long-term target of under 2.5x, and we have no debt coming due in 2025. This provides a significant financial flexibility, offering more optionality in the ways that we invest in the business, we are through capital investments that drive productivity improvements, or to bolt-on M&A that support our strategic growth objectives like our recent investment in Fiber.
It also provides us the opportunity to return even more cash to shareholders. And we are pleased to share that today we announced our quarterly dividend of $0.47 per share to be paid on March 14. This is an increase of 6.8% and represents our fourth consecutive year of increases. Clearly demonstrating our attention to sustainably increase our dividend.
And now I'll conclude with our financial outlook. For 2025, we are issuing guidance that is in line with our long-term growth algorithm. However, the global met by environment is rapidly evolving, resulting in uncertainty around the effects of geopolitical events and global trade policy, including the impact from consumer trends. As a result, our outlook does not reflect the impact of these activities or any imposition of import tariffs by the US and potential retaliatory actions by other countries.
Also, please remember that net sales revenue and underlying pretax income growth guidance are on a constant currency basis and underlying earnings per share or not. Therefore, continued strength in the US dollar will result in a headwind to our reported results as well as underlying earnings per share growth and in the effective period using the current exchange rates.
With that speed, let's review our guidance metrics. Low single-digit net sales revenue growth on a constant currency basis, mid-single-digit underlying pretax income growth on a constant currency basis. High single-digit underlying earnings per share growth, underlying free cash flow of $1.3 billion, plus or minus 10%. Underlying depreciation and amortization of $675 million, plus or minus 5%. Net interest expense of $215 million plus or minus 5%. Underlying effective tax rate in the range of 22% to 24% and capital expenditures incurred of $750 million, plus or minus 5%. Drivers that underpin our guidance include anticipated annual net price increases of 1% to 2% in North America, in line with the average historical range and for other markets to trend in line with inflation.
Mix should be a meaningful growth driver as we advance toward our medium-term goal of reaching about 1/3 of our global net brand revenue from our above premium portfolio. We expect this to come from continued premiumization in EMEA, APAC and Canada as well as progress in the US, where, as Gavin shared, we are starting to see some initial traction with Blue Moon. A big chance for Peroni and standing in non-alc.
While Fevertree and the consolidation of ZOA provide incremental benefits to the top line, we will also be cycling revenue from the smaller regional craft breweries we divested in the third quarter and more significantly 2024 pabst in the back contract brewing volume as these contracts terminated at the end of last year. On a combined basis, we expect to relate to approximate $1.9 million hectoliter headwind to Americas financial volume in 2025. We produced about 1.2 million hectares of PEP in the US and 700,000 hectoliters of (inaudible) brands in Canada in 2024.
Given the PEPS volumes wound down sequentially over the course of 2024, the headwind is more pronounced in the first half of the year, particularly in the first quarter. And the 2024 (inaudible) volumes follow typical seasonal trends. There are several additional shipment phasing considerations. In the first quarter, we are cycling particularly strong demand for core power brands in the US in the prior year period when US brand volumes were up 5.7%.
Also, in the first quarter of 2024, we benefited from higher than typical inventory build given our anticipation of the Fort Worth strike. This contributed to US financial volume increasing 7.6% in the first quarter of 2024 despite the exit of 350,000 hectoliters of PEPs volume. This higher than typical inventory bold extended into the second quarter of 2024, and we do not anticipate a similar level of first half inventory bold in 2025.
Turning to costs. In the first quarter, we anticipate incurring onetime transition and integration fees related to the Fevertree partnership, which will be reported in our underlying results. The costs will be determined over the next few months based on discussions which are ongoing. We also expect full year margin expansion coming from a number of drivers.
They include mix benefits from lower contract brewing and increased premiumization, moderating inflation on input costs and productivity improvements and cost savings. We also expect to continue to put the right commercial pressure behind our brands globally, focusing on retaining existing customers and attracting new ones.
Given our deep capabilities and return oriented strategy, our growth outlook does not require us to make step changes in our marketing investments. In closing, we are pleased with our progress in 2024. We believe we have the right strategy and with strong brands, a highly cash-generative business model and a healthy balance sheet, we have the ability to continue to invest in our business to achieve long-term financial growth and our strategic goals.
While also returning cash to shareholders through a growing dividend and a meaningful share repurchase program. With that, we would like to open it up to your questions. Operator?
Operator
(Operator Instructions) Chris Carey, Wells Fargo.
Christopher Carey
Gavin, I was wondering if you could comment a bit on what we're seeing being the beer category specifically year-to-date or whatever near-term time horizon you'd like to use. I think there's been a debate about increased volatility in recent weeks and months. Whether that's weather or changing consumer preferences.
But I'd love to get your thoughts on some of the near-term evolution of what we're seeing in the data and how you see industry dynamics and perhaps how you're thinking about this in the context of your full year guidance? And then more of a just sneak in question, but Tracey, are you factoring any share repurchases in the outlook? Or any context on share buybacks for this year.
Gavin Hattersley
Thanks, Chris. Well, I'll let Tracey answer your speaking question. But I'll deal with the industry first, Chris. Look, I mean, if you look at 2024, there was a lot of noise, right? I mean we talked about a lot of that over our earnings calls with trading days and holiday timings and turbulent weather and all sorts of things going on.
And Summer was not particularly good. But we did see progress in Q4. And in fact, I think Q4 ended up being the best quarter of industry performance that we experienced last year. And Chris, as it relates to current trading, I would say what we said on the last call, and I think the call before that, a, is I think being cautious of short-term trends is important, right?
Because I think once you get to the full quarter and you remove noise that exists on a week-to-week basis, you get a much better sense of what's happening in the industry. And even with what you're seeing in the first publicly available data for 2025, it's utterly dissimilar to what we were experiencing in 2024.
Again, there is noise around weather and timing of holidays and I would just caution you not to draw assumptions based on a very short period of data, Chris.
Tracey Joubert
Chris and just in terms of share repurchases, look, we do intend to continue to execute our share repurchase program. And a reminder, increase both its systematic as well as an opportunistic execution component. So that allows us to consistently execute the program, but with also the ability to lean in if our models indicate if appropriate.
So based on our $2 billion program, which we announced in October 2023, and as Gavin said, we've already utilized about 40% of it in just the first 5 quarters and it is a 5-year program. So I think it's clear, our commitment to share repurchases. But the execution of the 10 very can be driven by a number of factors, including the timing of our capital commitments.
So for example, a planned investment in fever tree could drive that. But as I said, we are committed to the share repurchase program that we put in place.
Operator
Peter Grom, UBS.
Peter Grom
I really wanted to just follow up on Chris's question there. Just some perspective on the top line guidance. I know the various puts and takes, Tracey, as you alluded to, contract brewing, fever trading, , et cetera. But I guess just how are you actually thinking about underlying category growth across your key geographies?
Are you assuming category growth rates improve as we move into the summer, cycle easier comps? Or are you kind of assuming the steady status category growth improves, that would be more of a source of upside?
Gavin Hattersley
Thanks, Peter. Look, if you look at our major markets, right? In Canada, we've seen past inflation and interest rates, they continue to weigh on the economy but we have seen interest rate cuts. We've seen inflation start to come down. And Canada beer industry trends are fairly similar to the US
As I said to Chris, we're not seeing anything meaningfully different from the previous trends that we shared in the US, fairly conscious consumers are still looking to engage in channel and pack shifting.
And at the same time, the industry continues to see premiumization, which plays perfectly into our overall acceleration plan. In the UK, the economy is improving. Inflation is slowing down. It is competitive at the moment, but not a lot different from what we've been seeing through the back end of of 2024. And as you rightly point out, we do have puts and takes in our top line guidance. The take, as Tracey said, is contract brewing. And the pull is Fevertree for example.
But more broadly, the progress that we're making on our overall acceleration plans, whether that's our core brands globally, whether it's the premiumization progress that we're making or whether it's acceleration in beyond beer. So it's all of those factors taken into account fee.
Operator
Filippo Falorni, Citi.
Filippo Falorni
I wanted to ask on margins. So first, on the gross margin line, can you provide some context of the puts and takes in terms of pricing, mix benefit and commodity inflation or you expect that you included in your guidance? And particularly on the commodities, I know you have long-term hedging programs -- so -- but just any thoughts on the potential impact of aluminum tariffs and what that could mean for your COGS?
Gavin Hattersley
I'll let Tracey talk about the margin [freedom.] Thanks for the question. From an aluminum point of view, we did make changes to our sourcing strategy over the last few years. And so almost all of our aluminum is currently purchased in the United States or United States consumption, which is obviously our biggest market. But Tracey, do you want to give a more broad?
Tracey Joubert
Yes. Sure. Filip. So in terms of gross margin, look, we don't give specific gross margin guidance. But Note that our underlying gross margin percentage did improve in each of the last 2 years.
So as we look at our 2025 guidance, our long-term growth algorithm does anticipate underlying pretax margin expansion so building on the expansion we saw in 2024.
Some of the drivers of that. So in 2025, we do expect moderating inflation on input costs. And to your point, we do have multiple levers that support our growth algorithm. So it includes positive net pricing that we discussed in our guidance, positive mix from premiumization as well as the lower contract brewing volumes which will also drive productivity improvements, and we also continue to look at cost savings across our entire business.
So those are some of the things that I would say would drive some of the margin expansion.
Operator
Bonnie Herzog, Goldman Sachs.
Bonnie Herzog
All right. I had a question on your guidance, which you mentioned is in line with your long-term algo. Your guidance implies a fair amount of operating leverage this year. And I know you've touched on this, but hoping you could unpack this a bit for us, meaning you should get some leverage from the top line. But could you give us a little more color the drivers of EPS growth, such as the cost savings and efficiencies you expect to get this year?
And then maybe how much that could increase next year and beyond -- maybe if you don't feel comfortable quantifying maybe you could rank some of these cost savings in order of impact, for instance, I think that would be helpful.
Gavin Hattersley
Thanks, Bonnie. Tracey, do you want to take that?
Tracey Joubert
Yes. So I mean, a couple of things that I can point to in terms of the operating leverage and improvements in our operating margin. So number one, we've invested over the last couple of years in our capabilities to drive efficiencies and cost savings. And a lot of that investment is focused on our breweries, eliminating waste, driving efficiencies there and secondly, taking out the contract brewing will further help in terms of costs as well as efficiencies in our brewery.
So that's one of the bigger drivers around the cost and efficiencies. The other thing just in terms of marketing spend, for example, we spent the last couple of years really driving our return on marketing investments. And even though we do expect our engine to increase around some of the investments that we're making with innovation, Fevertree et cetera. There's also a number of of puts and takes that is coming out.
So for example, we divested of our underperforming craft breweries, and we can now redeploy those funds to other brands in 2025. So we'll continue to look at that. And then one of the bigger items as well is bringing the Peroni production onshore. And there's meaningful ocean freight savings by doing that. And we're then able to utilize those cost savings to again support the marketing investment of that brand.
So a number of levers that we can pull in a number of capability investments that we've made over the last couple of years that we'll start seeing coming through now that will certainly help our margin as we look at continuing to drive efficiencies in the areas that we operate.
Operator
Andrea Teixeira, JPMorgan.
Drew Levine
This is Drew Levine on for Andrea. Gavin, I wanted to ask on the US brand volumes were down 3%. I think that came in probably a bit better than the tracked channel of data would suggest despite, I think, what has been described by some other peers as maybe a shift towards those channels. So any color would be helpful on what you're seeing from a consumer perspective? I know you mentioned some moderation in the value-seeking behavior, but maybe some perspective on different channels, if on-premise is outperforming, maybe untracked channels performing better. So any help there would be great.
Gavin Hattersley
Thanks, Drew. I think one point I'd make is I think there was an extra trading day. So that's certainly that certainly would have helped. From a consumer point of view, we did see them moving away from C stores earlier in the calendar year in the sort of summer time period. And now we've seen it move back into the C-store channel.
We've also seen on-premise continue to slightly outperform. But broadly, I would say those are the 3 key ones. Thanks, Drew.
Operator
Gerald Pascarelli, Needham & Company.
Gerald Pascarelli
I wanted to go back to the share repurchase commentary. So as we look at the outlook for 2025, the high single-digit growth, Tracey, is it fair for us to assume that you maybe to think about it in terms of like straight lining the remaining authorization with any potential upside to earnings growth being you remaining aggressive on buybacks, but that maybe shouldn't be part of the base case scenario? Just trying to get a little bit more color there.
Tracey Joubert
Yes. So a couple of things to consider as we talk about the high single-digit underlying EPS growth, I mean, some of that certainly is being driven by share repurchases. And our guide assumes at minimum repurchases in line with our 10b5-1 plan. But some other factors that play into our EPS growth is also tax and foreign exchange.
So our EPS is not on a constant currency basis. So ForEx could impact that. And then we have reduced our underlying effective tax rate guide for 2025 to 22% to 24%, and that was from the 23% to 25% in 2024. But as I said, we'll continue to look at all of our capital allocation models and make sure they'd be returning the right -- we're making the right investment decisions to return to our shareholders.
So, yes. As we said, it could vary. The share repurchase, driven by a number of factors, as I said, whether we have planned investments like Fevertree for example. So that may impact the sort of amount we spend. And also, just as a reminder, [Actify] program, and we're only 5 quarters into this.
Operator
Rob Ottenstein, Evercore. Looks like Rob has disconnected.
Kevin Grundy, BNP Paribas.
Kevin Grundy
Great. First, a quick housekeeping question, then a bigger picture question. Easy for me to say. The housekeeping question for Tracey. It would seem like the guidance would imply that volume is down 1% to 2% based on your commentary of 1% to 2% price and then some favorable mix.
I just wanted to confirm that's your expectation relative to an exit rate that was a bit more challenged than that in the US and Europe.
Then on the bigger picture question is just the demand outlook looking out now over the longer term. We get a lot of questions from investors on potential impact of younger consumers drinking less frequently, negative impact from GLP-1, the recent advisory from the former surgeon general, linking alcohol consumption and cancer risk. I was hoping you could comment on these potential headwinds and how they may impact the industry more broadly.
So not just beer, but US alcohol more broadly? And then how it may directly impact your strategy as it pertains to your portfolio.
Gavin Hattersley
Thanks, Kevin. Do you want to comment on the first one, Tracey? I'll take the bigger picture.
Tracey Joubert
Yes. Yes. So Kevin, so look, the drivers for our top line growth in 2025, I mean, of course, we remain focused on our US share performance. The NSR guidance is also dependent on a number of factors, including price and mix.
In 2024, we achieved really strong annual top line contribution from both our EMEA and APAC business and from Canada. We don't specifically give volume guidance. But just as a reminder, we've got puts and takes there as well. So we will receive a benefit from bringing Fiber.
Gavin mentioned naked lives, et cetera, that we're going to be launching. But a reminder as well, we're taking up 1.9 million hectoliters of contract brewing volume out of our system in 2025. So that will have an impact on our financial volume as well.
Gavin Hattersley
Thanks, Tracey. And look, Kevin, I mean your questions are very broad one, right? So let me try and answer that. You referenced the surgeon in general, right? Obviously, there have been several reports from the federal government over the past few months.
They've had a variety of viewpoints on the science and I would point out that we've had a surge in general warning on label since the 1980s, which includes that alcohol consumption may cause health problems.
I think beer has long been the drink of moderation. And we offer consumers a range of options, including no and low alcohol beverages. We're committed to the transformation of our company into a total beverage company. That's where we changed our name to Molson Coors Beverage Company several years ago, and we've got a long-term strategy of diversifying our portfolio into beyond beer and non-Alc a key part of that diversification and it supports broader consumer trends as you said, around mindful drinking with categories like non-alc beers and RTDs. And we've got a 3-pronged approach to that, whether it's alcohol replacement.
We've got a great portfolio of brands directed at that with too great, both premium non-LP Blue Moon, non-Alc and Peroni 0. We're launching Naked Life, which is a non-land cocktail. Then we've got alcohol adjacencies, and that's where every is absolutely perfect trip for us because it sits at that intersection between alcohol and non-alcohol and then we've got the pure plays, which is highly incremental for us at an occasion level doesn't necessarily exist and ZOA is a great example of that.
And then Kevin, we've proven that we can grow in our traditional beer space. I mean Coors Banquet is a fine example of that, right? It's the number 1 fastest-growing beer brand, beating out Madela and we're gaining distribution, gaining occasion. We're gaining consumers, including younger legal drinking age consumers behind that brand. So we feel very confident that the portfolio that we are building will meet the demands of our consumers both now and on a go-forward basis.
Operator
Bryan Spillane, Bank of America.
Bryan Spillane
Maybe, Gavin, just to pick up on Kevin Grundy's last point. Can you just maybe give us a little bit more color on the decision to engage with FeverTree and maybe just like what's -- what do you think is different, right? I mean the FeverTree and Molson Coors come together, you're going to have this venture there must be something that's missing now that Molson Coors can add to it. I'm just kind of curious to know how you think about that and what that may be?
Gavin Hattersley
Yes. Great question. Thanks, Brian. Look, I think it's building our great portfolio even further, right, to meet the needs of consumers at various occasions. And as I said, non-alc beverage is key to that strategy.
And in the US, Fevertree is the world -- well, it's actually the world's leading supplier of premium carbonated drinks and mixes.
And as I said, it fits really nicely at the intersection of beer and non-alc it's availability is often in stores where beer is actually sold. It's steadily grown its lead as the number 1 tonic in ginger beer. I think it provides tremendous credibility to our network and broader network that we are serious about not alc. It's a big business. It's a growing business.
What do we bring to it? I mean, we've talked about our core competencies and our capabilities in the past before, Brian. And one of them is we have a tremendous network of distributors that delivered to stores which Fevertree has not been delivering to in the past. I mean I think we service over 500,000 different outlets and Fevertree gets to tens of thousands of those at the moment. So our broader reach is substantial.
We're also going to increase our non-Alc resources quite meaningfully in the first part of this year. So brings critical mass to us from a non-alc point of view with Solar, which we took a majority stake in late last year. And as I said, we've got noted life coming, and we've got and we've got every which is in our portfolio from last week.
So I think -- well, -- we're very excited about this. It provides real credibility to our system that we are serious about non-alc and we mean business here.
Operator
Rob Ottenstein, Evercore.
Robert Ottenstein
Just a few follow-ups, if I may. So Gavin, can you just sticking on the Fevertree agreement. Can you give us a rough idea of what the economics look like and how this could potentially impact your income statement 3, 4, 5 years out. Just any way for us to kind of model it any guidelines at all? And then second, I know you mentioned that your guidance doesn't include anything for tariffs.
And obviously, it's impossible to, right, because who knows what's going to happen.
But again, can you help us to model that out in terms of Canada. Did you see when Trudeau talked about boycotting American brands, did you see any impact on Coors Light, Miller Lite, your US brands that are in Canada. Are they brewed in Canada? Or do they come from the US?
And what percentage of your sales in Canada come from those brands? And any other tariff-related issues outside of aluminum, which we already talked about that we should be considering as we kind of run our sensitivities for 2025.
Gavin Hattersley
Robert. Two big questions. Let me start with the second one. We import very little product into the US from Canada and Mexico.
That's the first point I'd make. Almost all of the brands that we produce that are consumed in the United States from our portfolio are brewed in the United States. The last big one really was that we imported was Peroni. And as you know, and we've talked about in the Pabst, we've brought that in-house and have -- we're really excited about the potential for Peroni as we go forward.
Beyond that, there are a few very minor immaterial from a volume perspective brands that have come across from Canada and Mexico. As it relates to Canada, the vast majority of the brand portfolio is, again, it's produced in Canada for Canadian consumers. We have a large import agreement with that comes from Europe, so it wouldn't be impacted by US tariffs. But again, the vast majority, Canadian proved Canadian-produced and I think consumers are aware of that.
From an input material point of view, again, Robert, the vast majority of our input materials come from the countries in which they produced. Obviously, not everything, but I spoke about aluminum earlier on being (inaudible) entirely sourced in the United States, all the United States markets. All of our agricultural input costs like [Balmain] hubs and so on, all is sourced in the markets in which it's consumed.
Certainly, in our bigger markets. But as you say, there is uncertainty, but we're in the same boat as most other businesses as it relates to tariffs with the exception of the fact that we produce all of our -- almost all of our products in the market in which they consume. As far as Fevertree is concerned, look, we don't give that level of detail that you're looking for. But obviously, we've entered into this relationship because we see real potential with this brand.
We see growth opportunities from a volume perspective, obviously, it's 100% incremental to our business, but we see growth off their base. 2025 is going to be a year of integration and absorbing it. And as I said, we're expanding our resources behind this, which will take place in the earlier part of the year. Tracey did mention that we will have some onetime costs associated with that, and we're working through to determine what those are.
They're not in the hundreds of millions, just to give context, right? They are in the tens of millions and we'll resolve that and put a finer estimate on it once we've been through all our discussions, but it this is a brand that operates right at the top end of about premium. So from a revenue per hectoliter point of view, it's going to -- it might even be our number 1 now from a revenue per barrel point of view. As we integrate it and look for further opportunities in terms of cost efficiencies, we will certainly be looking at our supply chain and our supply chain partners as we look to drive value out of this relationship. But we really are excited about it, Robert.
Robert Ottenstein
I think I covered both profit questions, Tracey.
Operator
Kaumil Gajrawala, Jefferies.
Kaumil Gajrawala
Two things. The first, I guess, along the lines of fee for treatment, not specifically, when we think about the Yuengling deal and which start -- which is partnership, desirous partnerships with Coke, the to that went from partnership to ownership. As we think about all of these things and then Fevertree of being the newest on, how do you think about it in the context of M&A?
Why is sort of a small stake, the right amount with whatever P&L that contributes to your business versus the P&L that goes to the distributors. Why not sort of being more aggressive on M&A, kind of like what you've eventually done ZOA and have full ownership. And then the second question, which will be a lot more narrow is quite a bit of strength out of Canada. Can you maybe give us a little bit more on what was behind that?
You gave us a bit in the prepared remarks, but love to learn if this is something ongoing, something that's sort of building or if there were just a couple of nice hits last quarter that may not continue.
Gavin Hattersley
Thanks, Kaumil. It's not the latter. It is not just a couple of nice yes. I mean the performance in Canada has been building over quite some time. For example, we've seen 23 consecutive months of share growth and that includes growth in period includes growth in RTDs. It's driven by the strength of our brands.
It's driven by the strength of the execution of our strategy on those core beer brands on premiumization of our portfolio and of expanding into flavor (inaudible) Our core power brands, Coors Light and Molson the trademark, we grew share of segment through the fall and Miller Lite, which sells in the above premium tier is one of the fastest-growing beer brands in the category. And then the 3, which we launched last year has delivered ahead of our expectations.
And in flavor, we're the fastest-growing company in the RTD space. So Canada's success is broad. It is deep. It's been going for, as I said, quite some time now, and it gives us a nice useful blueprint for the US where we've got the opportunity to strengthen our results, particularly in the above premium space.
Performance in Canada has been strong in summary. Fevertree look, I mean we're good at partnerships. I think that's one of our core strengths, core competencies. We've got partnerships all over the world. As it relates to the specific investment, which Tracey alluded to, in uses of cash, I mean, it fits perfectly into our string-of-pearls approach, right?
I mean, we didn't talk about Pearls getting a little bigger. And so our investment in Fevertree is a little bit bigger than some of the ones that we've made in the past, but it's still part of the string of Pearl's approach.
Why did we do it? Because we see real potential in Fever-Tree. The United States is their biggest market. It's their biggest growth market. We're representing them here now. So 100% of the performance will be included in our P&L. But at the same time, we wanted to take some advantage of the value which we believe is going to be created at a fever tree level. And so we're now the second largest shareholder, and we're comfortable with that position.
Operator
Eric Serotta, Morgan Stanley.
Eric Serotta
First Gavin, could you talk a bit about shelf space expectations for your brands in 2025, coming off of a really strong gains that you had for the core brand last year and in 2023? And then Tracey, just an accounting clarification, so it sounds like you guys are going to be booking just the US partnership revenue for Fevertree. Is that correct? And will any equity income from your overall ownership in the company, come through the equity income line?
Or is that going to just be held at cost?
Gavin Hattersley
Thanks, Eric. I would say that shelf research, I mean, we saw an unprecedented shift in shelf research back in the spring of -- in the fall of 2024, we held those grains. And we even grew them a little. So that means that when you compare us to the 2023 base, we're up significantly. Now as we head into spring of 2025, generally, each year, there are minor adjustments to shelf space.
retailers add new items, they delete discontinued and slow-moving ones. And. It's a little early days yet, and we haven't got all the dates or in. But for spring of 2025, we expect that to be the case again. And again, while it's early, we expect to hold on to the share gains in the spring in the spring once again.
So we feel really good about the step change that we've seen in Shaft resets. And it's certainly been a big contributor to why we've held on to so much of the share gains that we gain with Coors Light, Miller Light and Coors Banquet. I mean in the fourth quarter, that actually accelerated a little bit.
I think we said in Q3, it was around 80%. Well, it's actually more than 80% now that we retained in the fourth quarter. And we're very, very pleased about that, obviously, burs if you compare it back to 2023, we're about 170 basis points of share higher with those brands than we were before. So yes. Tracey, do you want to deal with the cutting question?
Tracey Joubert
Yes. Thanks, Eric. So look, in terms of how we're going to report Fevertree in the US, so we had a license agreement to distribute their products in the US and we will recognize 100% of the revenue for all of the products sold in the US. We'll share jointly in certain costs, which include marketing, so it results in profit sharing at the EBITDA level.
And then we'll also pay them via a royalty, which will be included in our COGS. In terms of the investment that we've made in the fever tree business entity, it will be reported on a cost basis and we'll mark that to market and will exclude it from our underlying results.
Operator
Bill Kirk, Roth Capital Partners.
William Kirk
So Gavin, your largest competitor wants to rebrand the domestic beer segment to, I think, the American beer segment. Do you agree that the industry should stop using that domestic terminology? And if that set positioning changes maybe combined with a broader populist movement, do you think help -- it would help the brands within that segment?
Gavin Hattersley
Thanks, Bill, and good morning to you. Our brands go back many generations in both Canada and in the United States. And we're obviously very proud of our heritage and I would suggest that everybody knows about the roots of our great iconic brands -- our focus is on our acceleration plans and our portfolio.
And as I've said on this call and we said in our opening remarks, our brands are in a great place, particularly our core brands, which is gain substantial share since 2023 and retained a lot of that. And so that's where our focus is.
Operator
Lauren Lieberman, Barclays.
Lauren Lieberman
Great. I'd love to just hear a little bit about your read of the competitive environment in the US. We heard a bit kind of through this earnings season about a step-up in promotional activity both with premium like in the above-premium space. So I was just curious to what degree you're seeing that or not?
Gavin Hattersley
Thanks, Lauren, and good morning to you. We haven't seen anything unusual from a rational point of view. It's common that there is some level of promotional activity. Most of that takes place in the summer, though, not in Q4 or in Q1. Most of that takes place in Q2, Q3.
It's a fairly regular thing. You see different things in different markets. But we haven't seen anything unusual from a promotional point of view. And as we always do, we'll take a strategic approach to evaluating the overall competitive landscape, consumer dynamics, and we'll do what's right for our brands.
Operator
Michael Lavery, Piper Sandler.
Michael Lavery
Just wanted to come back to innovation and just have seen a lot of the innovation in the space skew towards higher alcohol some a little bit maybe more exaggerated cases, things like Box or buzz balls, but you're simply spike Bold and Blue Moon Extra are moving in that direction with an 8% ABV version. Do you have a sense of just what is an impact that has on category volumes? And if some of that is -- if that direction of innovation is helping drive weakness and a little bit just related, can you maybe touch on how that sell-in went? And do you have a sense for how your innovation is landing on the shelf resets. Also maybe for ZOA as well, did that -- did you get ownership in time to move the needle on where that lands on show.
Gavin Hattersley
Thanks, Michael. Yes, lots of questions there. Let me just say that, no, I don't see that innovation, both from ourselves and our competitors is negatively impacting beer as a category. In fact, I think it's positive. I mean, if you look at beer as an overall industry, we did very nicely against spirits.
I mean all of Spirits' growth is coming in the RTD space, which where the beer guys are playing. And so if you just look at -- if you exclude it the prepackaged spirits from spirits performance, it will be quite negative.
So all of the growth in spirits is coming from that, and we and our competitors play quite meaningfully there. As it relates to higher alcohol, I mean, we did talk about this previously around our first-ever convenience-led innovation pipeline. And we've got 3 great new launches that are coming, that fit that trend is what consumers are looking for in terms of singles and higher ABV.
We've got simply spike Bold coming with top Margarita Mix, and we've got Blue Moon Extra, and they're all coming at that sort of 8% level. And another great area of innovation for us is for example, Happy Thursday. I don't know if we've talked about this before, but we did create a GenZ culture panel last year. And as we looked at that and then with broader consumer insights, this panel has really been helpful in how we innovate for new legal drinking age tuners and happy Thursday came right out of that.
It also helps us inform how we market and sell our products, whether it's through e-commerce or who we partner with, like League Cup and Formula One and where we go from a digital space. So I've probably gone a little broader than your direct question, Michael, but hopefully, that's helpful.
Operator
Robert Moskow, TD Cowen.
Robert Moskow
There was a pretty significant slowdown in your EMEA APAC gen. And you attributed to heightened competition and just the consumer backdrop. Is there any reason to believe that those divisions can grow as fast as the rest of the company in 2025? Or do you think we're going to be flattish like we were in fourth quarter for the year?
Gavin Hattersley
Thanks, Robert. Look, I mean, certainly, consumer demand in the UK was softer in 2024 when you compare it with 2023. We did see some uplift in the summer through the euro soccer, but weather obviously offset a lot of that. Christmas season was satisfactory, although we did see consumers coming in late in the season as opposed to earlier.
As it relates to our business specifically, for Carling, which is our biggest brand in the UK and in the EMEA APAC business unit, we took a value-over-volume approach. We certainly will continue to support the brand strength of that versus our competitors. But no doubt, we took a value over volume strategy. But really, we continue to see drive both volume and value growth across both channels. It's launched very nicely in new market in Bulgaria during 2024. We have another market plan for 2025. We've got great brands in EMEA, APAC. We've talked about (inaudible) in the past. And over time, I see no reason why our EMEA APAC business won't grow quicker than our businesses in North America.
Thanks for the question, Robert.
Operator
Thank you. We have no further questions. That now concludes today's call. Thank you for joining. You may now disconnect your lines.
