Constellation Brands, the producer of Corona and Modelo beers, announced on Thursday its financial results for the second quarter of fiscal year 2024, reporting revenue and profit that exceeded Wall Street estimates. The company attributed the performance primarily to sales growth in its beer division.
For the quarter ending Aug. 31, 2023, the company reported net sales of $2.84 billion. According to data from the London Stock Exchange Group (LSEG), analysts had, on average, projected revenue of $2.82 billion. The company’s comparable earnings per share (EPS) stood at $3.70, surpassing the consensus estimate of $3.37 per share.
The company’s Beer Business division recorded a 12% increase in net sales, reaching $2.4 billion. Depletions, a measure of how quickly products are sold from distributors to retailers, grew by 8.7%. Constellation Brands noted that Modelo Especial became the top-selling beer brand in U.S. retail channels during the period.
In contrast, the Wine and Spirits Business division experienced a 14% decline in net sales, reporting $437.5 million for the quarter. Depletions for this segment decreased by 8.4%.
“Our Beer Business delivered excellent results in the second quarter,” said Bill Newlands, President and Chief Executive Officer, in the company’s official earnings release. “The launch of Modelo Oro and the continued success of our mainstream and above-premium brands are a testament to our ongoing efforts to meet consumer demand.”
Following the second-quarter results, Constellation Brands adjusted its financial outlook for the full fiscal year 2024. The company raised its forecast for comparable EPS to a range of $12.00 to $12.20, an increase from its previous guidance of $11.70 to $12.00. The forecast for net sales growth in the Beer Business was maintained at a range of 8% to 9%, while the Wine and Spirits Business is projected to see a net sales decline of 0.5% to an increase of 0.5%.
Garth Hankinson, the company’s Chief Financial Officer, stated, “We remain focused on delivering our financial and operational objectives while continuing to invest in our brands and capabilities to support long-term, sustainable growth.”
Following the earnings announcement, shares of Constellation Brands (STZ) traded higher on the New York Stock Exchange. The company’s report comes as the broader alcoholic beverage industry navigates shifts in consumer purchasing behavior.
