Constellation’s Sales Near $10B Despite Wine & Spirits Decline
April 11, 2024Constellation Brands reported net sales up 5% on a comparable basis to $9.96 billion for its fiscal year 2024, ended in February. Operating income rose 7% to to $3.25 billion for the year. Growth in the company’s fiscal fourth quarter was slightly accelerated compared to the full year with net sales rising 7% on a comparable basis to $2.14 billion and operating income up 7% to $631 million.
Growth for the company was driven by its beer business, which was up 9% to $8.2 billion for the fiscal year in terms of net sales and 8% to $3.1 billion in terms of operating income. According to Constellation, this marks the 14th consecutive year of volume growth for the beer portfolio. Beer shipments were up 7.4% to 418.1 million 24-pack, 12-ounce cases for the fiscal year, with Modelo Especial depletions rising 10%, Corona Extra up 1%, Pacifico up 17%, and Modelo Chelada up 30%. Depletions growth for the fourth quarter was similar, with Modelo Especial outperforming its fiscal year total and Modelo Chelada lagging its full-year growth.
Constellation’s stable of wine and spirits brands faced more challenging conditions, reporting fiscal year shipments of 23.8 million cases, down 10.2% on an organic basis. Wine and spirits sales declined 9% to just under $1.8 billion, which the company attributed to “wholesale unfavorability ” and destocking in international markets. Operating income fell 12% to just under $400 million. While the wider picture shows wine and spirits sales struggling, Constellation reported a 10% gain in DTC sales for the fiscal year. While sales declined in the fourth quarter, the drop was more muted than in the full year, with organic shipments down 5% to 5.7 million cases and net sales down 6% to $436.4 million.
According to Impact Databank, leading wine labels Kim Crawford and Meiomi were both roughly flat at 1.8 million cases in calendar 2023. The Prisoner offshoot Unshackled grew 11% to just under 200,000 cases, while the parent Prisoner brand was flat at 285,000 cases. On the spirits side, High West whiskey held its ground at 170,000 cases, while Mi Campo Tequila jumped 72% to 161,000 cases.
Looking forward, Constellation is expecting that its wine and spirits lineup will show improvement in fiscal 2025, with guidance calling for a 0.5% decline to a 0.5% rise for that part of its portfolio. On the beer side, sales are targeted to rise between 7% and 9%, driving an overall company gain in terms of net sales of 6% to 7%.
“We delivered another year of solid performance in fiscal 24,” said CEO Bill Newlands. “Our beer business continued its strong growth momentum as it achieved its 56th consecutive quarter of volume growth while maintaining best-in-class margin. We continue to see growth potential in our wine and spirits business as we focus on strong commercial and operational execution.”—Shane English
| Constellation—Leading Wines & Spirits in the U.S. Retailing At $15 & Up1 (thousands of 9-liter case depletions) |
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| Brand | Origin/Type | 2022 | 2023 | Percent Change2 |
|
|---|---|---|---|---|---|
| Kim Crawford | New Zealand | 1,829 | 1,840 | 0.6% | |
| Meiomi | California | 1,828 | 1,809 | -1.0% | |
| Ruffino Prosecco | Italy | 529 | 520 | -1.7% | |
| Simi | California | 536 | 498 | -7.0% | |
| The Prisoner | California | 287 | 285 | -0.8% | |
| Unshackled | California | 175 | 195 | 11.3% | |
| High West | Bourbon/Rye | 170 | 170 | -0.1% | |
| Mi Campo | Tequila | 94 | 161 | 71.9% | |
| Total Leading $15 & Up3 | 5,447 | 5,477 | 0.5% | ||
| 1 At least $15 a 750-ml. 2 Based on unrounded data. 3 Addition of columns may not agree due to rounding. Source: IMPACT DATABANK © 2024 |
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Tagged : Constellation Brands, Corona, High West, Kim Crawford, Meiomi, Modelo, Pacifico, The Prisoner, Unschackled
