Constellation Posts 5% Sales Growth For Full Year, Buoyed By Beer BusinessApril 9, 2015
Constellation Brands continues to reap benefits from its bet on beer, as the company’s portfolio of Mexican brews drove gains in its fiscal year ended in February. Overall, Constellation’s net sales rose 5% on a comparable basis to $6 billion for the year, and operating income leapt 35% to $1.6 billion. Every brand across the group’s Mexican beer stable grew during the year, led by Impact “Hot Brands” Modelo Especial and Modelo Especial Chelada, as well as Corona Extra. The beer unit’s net sales increased 12% to $3.2 billion for the full year, with depletions up 8% and shipments up 10% to 201 million (2.25-gallon) case equivalents.
Growth was more sluggish on the wine and spirits side, where net sales increased by 1% and volume declined 1.2% to 66 million cases. “While we did not achieve our overall wine market share goals for the year, we improved product mix and posted strong depletion trends for some of our fastest-growing wine brands,” said Constellation president and CEO Rob Sands. The group’s wine sales were down 1% to $2.5 billion for the year, although Ruffino, Kim Crawford, Nobilo, Black Box and The Dreaming Tree all earned Impact “Hot Brand” honors for their 2014 performances.
Sands added that new spirits launches like Svedka Strawberry Lemonade and Mango Pineapple, as well as Paul Masson Grande Amber Peach brandy and Casa Noble Tequila, contributed to “excellent growth” within Constellation’s spirits portfolio, which grew net sales 8% to $316 million during the fiscal year.
Meanwhile, Constellation has announced that it intends to pay a regular quarterly cash dividend to stockholders of its common stock, which Sands said “demonstrates confidence in our growth prospects, free cash flow and financial outlook over the long-term.”
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