A fortune 500 international producer and marketer of wine, beer, and spirits, Constellation Brands, announced its earnings report for the third quarter that ended on November 30th on Wednesday. Having beaten the analysts’ estimate for profit, the company raised its forecast for full-year earnings (adjusted).
The company cited sharply rising demand for its beers including Modelo Especial and Corona Premier. Following the performance results, share prices were seen trading 4% higher in premarket trading.
Constellation Brands Recently Launched Two Major Variants Of Beers
As per the analysts, the upbeat results in the third quarter are a testimony of how the company’s efforts towards widening its beer portfolio are paying off. Constellation Brands had recently announced two major variants by the names of Corona Refresca and Modelo Chelada Limon Y Sal.
A company representative also announced that Constellation Brands is set to launch an all-new Seltzer in 2020. Widening the Corona portfolio of the company, the new drink is targeted at addressing the rising demand for alcoholic carbonated drinks among the consumers of today.
Beers are known to be the most profitable segment for Constellation Brands. The earnings report highlighted on Wednesday that the company sold $1.31 billion of beer in the quarter that marked an 8.3% increase in its sales. The other business unit, however, remained under pressure with wines and spirits posting a 9.7% decline in sales. Noting $688.8 million in sales of wines and spirits in the third quarter, the company registered the fourth quarter in a row that noted a decline in this business unit.
Constellation Brands Expects $9.45 To $9.55 Earnings Per Share In Fiscal 2020
The revised guideline for fiscal 2020 highlighted the company to be forecasting earnings per share (EPS) within the range of $9.45 to $9.55. Previously, the company was expecting the EPS to remain capped at $9.20. The highlighted figure excludes the company’s investment in Canopy Growth.
Based on Refinitiv data, analysts were expecting $1.95 billion in net sales for the company. Printing a massive 1.4% growth, the company recorded a relatively higher $2 billion in net sales. Net income for Constellation Brands marked a 19% improvement to $360.4 million in the quarter. In terms of earnings per share, the company posted $2.14 against the analysts’ forecast of $1.83.
All in all, Constellation Brands saw a significant 18% growth in the stock market in 2019. The $36.87 billion company was seen trading as high as around $215 in April 2019. Much of the gain, however, was unsustainable later in the year as the company ended 2019 at around $190.