Beer sales boost Constellation revenue
Constellation Brands has reported a 7% rise in revenue in its third quarter results, boosted by sales of its beer brands including Corona and Modelo.
The company’s net income rose to $222 million, or $1.10 per share, in the third quarter to 30 November from $211 million, or $1.07 per share, a year earlier. Net sales rose to $1.54 billion from $1.44 billion.
The drinks producer, whose brands include Robert Mondavi and Svedka vodka, attributed much of its success to the “exceptional on-going momentum” of its beer business which saw net sales rise by 16% due to volume growth.
Rob Sands president and chief executive officer at Constellation Brands said: “Our beer business continued to gain share across all channels during the third quarter driven by Modelo Especial, Corona Extra and Modelo Especial Chelada. Our outstanding beer portfolio is experiencing tremendous momentum and generated the vast majority of total US industry volume growth in IRI channels during the quarter.”
In October, the company said it was expanding capacity at its Nava brewery in Mexico.
“Our Nava brewery expansion and glass-sourcing initiatives which are designed to support the strong growth of the beer business over the long-term, are progressing as planned from a timing and budget perspective,” said Bob Ryder, chief financial officer of Constellation Brands.
In terms of wine, net sales fell flat for the quarter while spirits were said to have generated “outstanding growth” driven by new flavour introductions and the integration of its newly-acquired Casa Noble Tequila brand. Constellation purchased Carlos Santana’s super-premium Tequila, Casa Noble, in the summer of 2014 – its first super-premium Tequila.
Constellation said it now expects to post earnings of $4.25 to $4.35 a share for the fiscal year ending 28 February, up on its previously projected earnings of $4.10 to $4.25 a share.