In a recent fiscal update, Constellation Brands showed its mettle in the beverages industry again. The company, revered for its ownership of prominent brands like Modelo Especial and Corona Extra, raised its fiscal 2024 earnings per share outlook to $9.60 to $9.80 from a prior range of $9.35 to $9.65 exceeding Wall Street expectations.
One of the significant takeaways is the stellar performance of the beer business. A robust double-digit sales growth showcases Constellation’s dominance in the beer and luxury categories. The beer portfolio, with a 12% surge in sales and an 8.7% increase in shipments, has particularly highlighted the Modelo brand family. The Modelo Especial brand witnessed close to 9% growth, while the Modelo Chelada brand rocketed with an impressive increase of more than 40%. Modelo Especial retains its crown as the top-selling brand in the U.S. beer sector.
However, not all segments saw the same prosperity. The wine and spirits category faced a slowdown, registering a 14% dip in sales. Further, there was an approximately 8% drop in depletions, which refers to the number of cases sold to retailers by a distributor. Despite the slowdown in mainstream brands, bright spots within this division include Meiomi and Kim Crawford wine brands and Mi Campo Tequila, which reported significant growth.
To address the challenges faced in the wine and spirits segment, Constellation Brands is strategizing on price elevation and leveraging direct-to-consumer channels. With these measures in place, the company is optimistic about the segment rebounding and gaining momentum, promising better returns in upcoming years.
In a rewind to June, the company continued its winning streak, surpassing earnings expectations. In the previous quarter, we also recorded a solid 11% year-over-year increase in beer sales, cementing Constellation Brands’ place as a formidable player in the beverage market.
