Constellation Brands, the owner of popular beer brands Modelo Especial and Corona Extra, exceeded analysts’ predictions in its fiscal second quarter of 2024. The company reported impressive double-digit sales growth in its beer division, solidifying its dominance in the beer market. However, sales of wine and spirits did not perform as well.
As a result of its strong performance, Constellation Brands raised its earnings per share outlook for fiscal 2024, expecting to earn between $9.60 and $9.80 per share, up from the previous range of $9.35 to $9.65.
The adjusted EPS of $3.70 performance, surpasses the expected $3.36, with revenue coming in at $2.84 billion, beating the expected $2.82 billion.
The company’s impressive growth in the beer segment was driven by a 12% increase in sales, with Modelo Especial leading the way with nearly 9% growth. The Modelo brand family, including Modelo Chelada, achieved over 40% growth.
Constellation Brands proudly announced that Modelo Especial remains the top-selling beer brand in the U.S.
On the other hand, the wine and spirits division experienced a decline in sales and depletions. Sales decreased by 14%, while depletions saw an 8% drop.
Despite this, select brands within the wine and spirits portfolio showed promise. The Meiomi and Kim Crawford wine brands achieved 7% and 6% depletion growth, respectively. Additionally, the craft spirit Mi Campo tequila reported over 60% depletion growth.
CEO Bill Newlands expressed confidence in the company’s Wine and Spirits Business, expecting growth acceleration and margin improvement in the second half of the year.
Constellation Brands previously delivered strong earnings in the last quarter, driven by consistent consumer demand and higher pricing in the beer segment.
(Source: Stefan Sykes | CNBC | Angela Palumbo | Barron’s)
