Brewer Constellation tops Wall St estimates for sales

Marco Green
April 6, 2019

Analysts had forecast sales of $1.07 billion, according to Refinitiv IBES data. Analysts polled by FactSet expected $1.73 billion.

Beer sales rose 9.3 percent to $1.09 billion in the fourth quarter ended February 28, as its brands Corona Premier, Familiar and Modelo Especial gained market share in North America during the winter holiday season.

The company's fourth-quarter sales growth was adversely affected by a 7.6% fall in its Wine and Spirits segment's sales to $707.1 million.

Constellation Brands Inc (NYSE:STZ), owner of alcohol brands including Corona, Modelo and Svedka, posted fiscal fourth-quarter numbers that have traders toasting their results. Shares are down 19% in the last 12 months.

For fiscal 2020, the company guided adjusted earnings per share of $8.50 to $8.80.

The company behind Corona and Modelo beer has been in focus after it announced that it would be investing in cannabis company Canopy Growth (CGC).

Constellation also will soon roll out its new Corona Refresca beverage, a flavored malt beverage targeting women.

Constellation Brands Inc. said late Wednesday it has agreed to sell about 30 of its brands of under-$11 wine to E. & J. Gallo Winery for $1.7 billion. Constellation had been looking for a buyer of its low-price, low-margin wines, which have been a drag on its earnings, as more USA wine drinkers trade up for pricier brands.

In 2016, the company divested its Canadian wine business to Ontario Teachers' Pension Plan for about 1.03 billion Canadian dollars (772 million USA dollars). Constellation has said it will be at least another year before its weed investment adds to earnings. The company expects to complete this divestiture by the end of the first quarter of fiscal 2020.

Shares of the company were down marginally at US$179.25 in morning trading on Thursday.

Other reports by Click Lancashire

Discuss This Article

FOLLOW OUR NEWSPAPER