• Full-year net profits rise by 20% to US$488m
  • Net sales fall by 20% to $2.65bn following sale of Australian, UK wine business
  • Operating profits hold steady, rising by 1% to $540m
  • Sale in key North American market dip by 1%
Constellation Brands released its full-year results earlier today

Constellation Brands released its full-year results earlier today

Constellation Brands has finished its fiscal year with rising profits, but sales have continued to struggle in the 12-month period.

The beer, wine and spirits company said earlier today (5 April) that net profits in the year to the end of February jumped by 20% year-on-year, coming in at US$488m. Sales, however, fell by the same percentage, to $2.65m, with COnstellation blaming the sale of its Australian and UK wine business to Champ Equity in February last year. Operating profits held their own, inching up by 1% to $540m.

Stripping out the divestiture from last year, sales in Constellation's domestic market slipped by 1% in the year.

In the final quarter, Constellation posted an 85% leap in net profits to $138m, although sales fell by 12% to $628m. Operating profits increased by 19% to $123m. The company highlighted that the comparable basis effective tax rate for the three-month period was -11%, compared to a 31% rate a year earlier.

In the fiscal year, Constellation's beer import JV with Grupo Modelo, Crown Imports, saw sales rise by 3% to $2.5bn although operating profits slowed, dropping by 5% to $431m. The company highlighted higher marketing spend as holding back operating profits.

President & CEO Rob sands praised the company's full-year performance, adding that it "positions us well for the upcoming year".

"We also generated record free cash flow, repurchased more than $400m of stock and acquired the remaining interest in Ruffino, which strengthens our position in the growing Italian wine category,” Sands added.

Looking forward, Constellation set an EPS outlook for fiscal 2013 of between $1.93 and $2.03, on a comparable basis. Actual EPS for the latest fiscal year totalled $2.34. "Comparable basis EBIT growth is expected to be tempered by brand building and sales investments," Sands noted.

At the same time as announcing the results, Constellation said that it will buy back up to $1bn of its common stock, in addition to the current $500m share repurchase programme. The buyback will be carried out over the next two years. "In the near term, we plan to take advantage of the favourable credit and public debt markets,” said CFO Bob Ryder.

Constellation's share price was down by 13% this morning, following the results announcement.

For Constellation's official statement, click here.