Globally largest premium beers, wines, and spirits manufacturer and exporter, Constellation Brands said that it has beaten up the sales’ anticipation set by Wall Street for the last quarter of the financial year 2018-19. The manufacturer said that the major cause behind this is the shift in the customers’ preference towards strong beers it is producing.
Last week, the stock value of the exporter in the market has reached $34.43 Billion with the hike in shares by 4%.
IWSR data revealed that U.S. alcohol consumers have strongly avoided beer and low-grade wines. Even some of the consumers are completely avoiding alcohol due to health awareness. However, the remaining alcohol consumers prefer superior wines and premium beer.
Last week, the alcohol producer agreed to hand over its almost 30 wines and spirits brands to E. & J. Gallo Winery in exchange of $1.7 Billion that is quite less as compared to $3 Billion, which Constellation had expected to procure for the brands. The amount acquired from the deal will clear the debts on the company and from now onwards, it will be concentrating on its premium wine brands.
During the quarter ended on February 28, the overall sales upturned by 2% to $1.8 Billion, thrashing Wall Street estimates of $1.74 Billion.
Compared to its beer sales in 2017, last Year was quite impressive for the company. The sales showed a significant hike of 9.3% from $997 Million to $1.09 Billion. The company even claimed that its beer business remained the chief U.S. market shareholder during the holiday season. The key brands behind its success are Modelo Especial, Corona Premium, and Corona Family Beers.
Conversely, its wine and spirits business was suffering from loss showing a revenue generation decline from $765 Million to $707.1 Million. Svedka Vodka, which is Constellation’s exceptionally leading vodka brand in the U.S., has been showing strong sales growth throughout the nation.