USA: Constellation Brands reports higher Q1 earnings driven by growth in beer business
Constellation Brands Inc. reported on June 29 a strong showing in its 2018 fiscal first-quarter earnings driven by growth in its beer business.
The Victor, Ontario County-based firm reported a net income of $402.8 million, or $2 a share, up from $318.3 million, or $1.55 a share, a year ago.
The company logged revenues during the quarter of $1.94 billion, up from$1.87 billion a year ago.
Constellation Brands earnings topped Wall Street expectations, but revenues fell just show of estimates. Analysts surveyed by Zacks Investment Research expected earnings of $1.98 a share on revenues of $1.95 billion.
“We’re off to a great start for our new fiscal year as we continue to deliver excellent results that demonstrate our commitment to sustain profitable growth and build shareholder value,” said Robert Sands, president and CEO. “Across the business, we’re driving consumer demand for our exceptional portfolio of premium products while executing strong financial and operational performance.”
The company’s net sales in its beer segment grew by 8 percent due to volume growth and favorable pricing, the company said.
“The first quarter results for our beer business are a testament to the ongoing growth opportunities we have for our iconic portfolio of brands, which posted depletions of almost 12 percent for the quarter,” Sands said.
He credited execution during the Cinco de Mayo and Memorial Day holidays, as well as the performance of the firm’s new Corona Premier and Familiar products as reasons for the increase.
Sales in wine and spirits dropped by 4 percent. Timing was a major factor in that decrease, Sands said.
“Our Wine and Spirits business delivered significant margin improvement in the first quarter, while depletion trends were impacted by the timing of promotional activities,” Sands said.
Constellation Brands ranked No. 1 on the most recent Rochester Business Journal list of food and beverage manufacturers.
Shares of the company were trading at $194.11 in the afternoon on June 29, up nearly 6 percent from June 28th’s close.
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