E-Malt.com News article: 3369

USA: Constellation Brands Inc., which sells Corona beer, announced on Thursday, September 30 that net sales for its second quarter ended Aug. 31, 2004, topping $1 billion for the first time in any quarter since the company was founded in 1945. Net sales increased 14 percent, driven by growth across the company's businesses of imported beers, spirits, branded wine and its U.K. wholesale business. Currency contributed five percent of the increase.

"We're pleased with the vibrancy of our beverage alcohol business' organic growth, and we're particularly happy about the performance of brands receiving incremental marketing investment in fiscal 2005, including Alice White, Ravenswood, Hardys and Blackstone wines, as well as our strong Corona beer results," stated Richard Sands, Constellation Brands chairman and chief executive officer. "Fourteen percent growth for our beers and spirits segment was driven by continued strong consumer demand for our entire Mexican beer portfolio. Our wines segment also grew 14 percent, with approximately half of that growth coming from additional distribution and sales of the brands we're supporting with incremental dollars. We're committed to growing our brands."

Constellation's reported net income increased 127 percent for the second quarter, to $80.6 million, and reported diluted earnings per share doubled to $0.69. Second quarter 2005 and 2004 reported results include restructuring and related charges and net unusual costs of $1.4 million after tax, or $0.02 per share, and $30.8 million after tax, or $0.30 per share, respectively. Net income, on a comparable basis excluding the restructuring and related charges and net unusual costs, increased 24 percent, to $82.0 million, and comparable diluted earnings per share increased 11 percent to $0.71. Diluted earnings per share growth was impacted by additional shares outstanding, primarily as a result of the company's equity offerings in July 2003, the proceeds of which were used to pay down debt incurred to partially finance the Hardy acquisition.

Net sales for the quarter grew 14 percent to reach $365.2 million on strong beer and spirits growth. Beers net sales increased 17 % driven by volume and the March 2004 price increase for the Mexican beer portfolio, including Corona Extra, Corona Light, Modelo Especial, Negra Modelo and Pacifico. Additional marketing support also contributed to the growth of the Mexican portfolio.

Operating income for Constellation Beers and Spirits grew 20 percent to reach $83.8 million for the second quarter, due primarily to higher net sales.


01 October, 2004