Revenues Decline at Constellation Brands

Constellation forecast adjusted diluted EPS for the fiscal year ending in February at $2.00 to $2.10, down from $2.34 in fiscal 2012, but higher than the consensus estimate of $1.99. The forecast does not include any impact from Constellation’s acquisition of the remaining 50% of Crown Imports, scheduled to close in the first calendar quarter of 2013.

The company’s president and CEO said:

As we execute our profitable, organic growth strategy, we are encouraged by the strength of our core beer, wine and spirits businesses including the success of our new product introductions and innovation pipeline across our entire portfolio of outstanding brands.

Constellation’s operating income fell 10% year-over-year in the quarter, which the company attributed to higher SG&A expenses and a planned increase in promotion spending. Equity earnings from its current 50% stake in Crown Imports totaled $71 million.

In premarket trading today, shares are up about 0.9% at $35.02 in a 52-week range of $17.95 to $34.93. Prior to today’s report, Thomson Reuters had a target price of $34.22 on the company’s shares.

Paul Ausick