US: Profits slip in Q1 as sales stay strong for Constellation Brands
- Comparable Q1 net profits drop by 3% to US$74m
- Net sales in three months to end of May rise by 6.1% to $673.4m
- Operating profits also dip, by 5% to $104m
Constellation Brands released its first-quarter results today
Constellation Brands has seen its first-quarter profits hit by rising costs, despite a slight lift in sales for the period.
The company said earlier today (2 July) that net profits on a comparable basis for the three months to the end of May were down by 3% year-on-year at US$74m. Net sales in the period increased by 6.1% to $673.4m, while operating profits fell by 5% to $104m.
The company highlighted higher grape and selling, general and administrative expenses as hampering profits in the quarter.
On a reported basis, net profits plunged by 27% to $53m, with operating profits falling similarly, by 34% to $71m.
Wine sales rose by 6% in the quarter and spirits sales were up by 4%. Crown Imports, the beer JV in the US with Grupo Modelo that Constellation has acquired, saw net sales increase by 5%.
“From an operational perspective, we are off to a positive start for the year, as we achieved our first quarter goals and objectives," said company president and CEO Rob Sands.
The firm confirmed in its results statement that it completed the purchase of Modelo’s US beer business from Anheuser-Busch InBev for around $4.75bn on 7 June. The transaction also includes Modelo's brewery at Piedras Negras, on the border between the US and Mexico.
Constellation said it expects its full-year earnings-per-share to come in between $2.32 and $2.62 on a reported basis, and between $2.60 and $2.90 on a comparable basis. The forecasts include a projected spend of up to $140m this year on "expansion activities" for the Piedras Negras brewery.
To read the company's official release, click here.
For a full round-up of just-drinks' coverage of Constellation's Q1 results, click here.
The final just-drinks management briefing of the year takes a look back at the last 12 months in the global drinks industry. The penultimate chapter in this five-part briefing reviews 2013 for wine....
The world’s second largest wine producer, Constellation Brands transformed its alcoholic drinks operations with the acquisition of Modelo’s US beer business in 2013. This profile considers strategies ...
With the end of the year looming, just-drinks is running a series of 'Top Tens of the Year' in the run-up to Christmas. Here are the ten most read news stories on just-drinks in 2013....
Alcoholic Drinks in Canada industry profile provides top-line qualitative and quantitative summary information including: market share, market size (value and volume 2007-11, and forecast to 2016). Th...
With the end of the year looming, just-drinks is running a series of 'Top Tens of the Year' in the run-up to Christmas. Here are the ten most read Hot Topics on just-drinks in 2013....
Wine in Hong Kong industry profile provides top-line qualitative and quantitative summary information including: market share, market size (value and volume 2008-12, and forecast to 2017). The profile...
- Analysis - Remy's Cognac "dead-cat bounce"
- Comment - How Hand-Made is Tito's Handmade Vodka?
- Heineken to stay "active player" in beer M&A - CFO
- Diageo's future brighter than present suggests
- Diageo's Q1 Results by Region
- Moët Hennessy unveils first Travel Retail outlet
- United Spirits sees Q1 net loss
- Beam Suntory, Edrington part ways in Travel Retail
- Diageo puts Beckham centre stage in Haig Club ad
- Moet Hennessy sales falter in YTD