Constellation Brands Inc : Constellation Brands Reports Third Quarter Fiscal 2013 Results

 Constellation Brands Inc : Constellation Brands Reports Third Quarter Fiscal
                                 2013 Results

  *Achieves comparable basis diluted EPS of $0.63 and reported basis diluted
    EPS of $0.58 

  *Results include lower than expected tax rate

  *Updates fiscal 2013 outlook for tax rate benefits; expects comparable
    basis diluted EPS of $2.10 - $2.20 and reported basis diluted EPS of $1.97
    - $2.07 

  *Reaffirms free cash flow target of $450 - $500 million for fiscal 2013

  *Acquisition of remaining 50 percent interest in Crown Imports continues to
    be targeted to close first quarter calendar 2013

Third Quarter 2013 Financial Highlights*
(in millions, except per share data)
                                   Comparable  % Reported    %
                                                  Change                Change
Consolidated net sales                       $767     9%         $767       9%
Operating income                             $173    13%         $159      -1%
Operating margin                            22.5% 70 bps        20.7% -220 bps
Equity in earnings of equity                  $53    -1%          $53      -2%
method investees**
Earnings before interest and taxes           $226     9%           NA       NA
Net income                                   $119    18%         $110       4%
Diluted earnings per share                  $0.63    26%        $0.58      12%

^*Definitions of reported and comparable, as well as reconciliations of
non-GAAP financial measures, are contained elsewhere in this news release.
^**Hereafter referred to as "equity earnings."
NA=Not applicable

VICTOR, N.Y., Jan. 9, 2013 - Constellation Brands, Inc. (CBI) (NYSE: STZ and
STZ.B), the world's leading premium wine company, reported today its third
quarter 2013 results.

"The year is unfolding as we expected and we are on track to meet our
financial and strategic goals for the year," said Rob Sands, president and
chief executive officer, Constellation Brands. "We continue to experience
strong marketplace momentum across our beer, wine and spirits portfolio and we
were well positioned at retail during the key holiday selling season. We are
especially excited about the prospect of achieving the next significant
milestone in the history of our company by obtaining 100 percent ownership of
Crown Imports, which will solidify Constellation's position as the largest
U.S. multi-category supplier across the beverage alcohol segment. We continue
to expect this transaction to close during the first calendar quarter of this

Net Sales Commentary

Wine and spirits net sales on an organic constant currency basis increased six
percent primarily due to an increase in volume and favorable product mix,
partially offset by higher promotional costs.

"We continue to post solid depletion trends for our portfolio and outperform
the U.S. wine and spirits industry in the SymphonyIRI channels as our
promotional investments have driven distribution gains at retail," said Sands.
"Innovation efforts are also playing a key role in our marketplace success and
Woodbridge, Rex Goliath, Kim Crawford, Ruffino and Mark West are driving
excellent performance for our Focus Brands portfolio."

Operating Income and Net Income Commentary

The increase in consolidated comparable basis operating income was driven
primarily by the favorable net sales growth combined with benefits from Mark
West and Ruffino, partially offset by higher SG&A costs.

The company's equity earnings from its 50 percent interest in the Crown joint
venture totaled $39 million compared to $43 million from the prior year third
quarter. For third quarter 2013, Crown generated net sales of $547 million, an
increase of one percent, and operating income of $79 million, a decrease of
nine percent. Third quarter net sales for Crown were tempered by the second
quarter wholesaler buy-in of product in advance of planned price increases and
the loss of St. Pauli Girl brand volume. As expected, operating income was
impacted by the volume shift and the timing of marketing spend.

"Crown continues to outperform the U.S. beer industry and the import category
led by strong performance of Modelo Especial, which recently surpassed the 40
million case milestone for calendar 2012," said Sands. "The brand is gaining
distribution at retail and experiencing continued discovery by general market
consumers in addition to the already strong growth driven by Hispanic
consumers. Crown's marketplace results are also benefiting from Corona's
'Find Your Beach for the Game' promotion and Corona Light's 'Refreshing Change
of Beer' advertising campaign." 

Interest expense totaled $61 million, an increase of 33 percent. The increase
was primarily due to higher average borrowings.

The comparable basis effective tax rate for third quarter 2013 was 28 percent
which reflected higher foreign tax credits and compares to a 37 percent rate
for the prior year third quarter. The company now anticipates the full year
effective tax rate for fiscal 2013 to approximate 27 percent, which is the
driver of the improved diluted EPS guidance for the year.

Free Cash Flow Commentary

Free cash flow for the first nine months of fiscal 2013 totaled $337 million
as compared to $587 million for the same period last year. The decrease was
primarily due to higher U.S. grape and bulk wine purchases in fiscal 2013 and
the receipt of tax refunds in the prior year period. The company continues to
target free cash flow of $450 - $500 million for fiscal 2013.


The table below sets forth management's current diluted EPS expectations for
fiscal 2013 compared to fiscal 2012 actual results, both on a reported basis
and a comparable basis. 

                         Reported Basis             Comparable Basis
                         FY13          FY12          FY13          FY12
                       Estimate       Actual       Estimate       Actual
Fiscal Year Ending   $1.97 - $2.07   $2.13   $2.10 - $2.20   $2.34
Feb. 28/29

Full-year fiscal 2013 guidance includes the following current assumptions, but
excludes any impact from the closing of the purchase of the remaining 50
percent interest in the Crown Imports joint venture:

  *Interest expense: approximately $225 - $235 million

  *Tax rate: approximately 27 percent 

  *Weighted average diluted shares outstanding: approximately 190 million

  *Free cash flow: approximately $450 - $500 million

Conference Call

A conference call to discuss third quarter 2013 results and outlook will be
hosted by President and Chief Executive Officer Rob Sands and Executive Vice
President and Chief Financial Officer Bob Ryder on Wed., Jan. 9, 2013 at 10:30
a.m. (eastern). The conference call can be accessed by dialing +973-935-8505
beginning 10 minutes prior to the start of the call. A live listen-only
webcast of the conference call, together with a copy of this news release
(including the attachments) and other financial information that may be
discussed during the call will be available on the Internet at the company's
website: under "Investors," prior to the call.


Reported basis ("reported") operating income, net income and diluted EPS are
as reported under generally accepted accounting principles. Operating income,
net income and diluted EPS on a comparable basis ("comparable"), exclude
restructuring charges and unusual items. The company's measure of segment
profitability excludes restructuring charges and unusual items, which is
consistent with the measure used by management to evaluate results.

The company discusses additional non-GAAP measures in this news release,
including constant currency net sales, organic net sales, comparable basis
EBIT, comparable basis effective tax rate and free cash flow.

Supplemental Financial Information

Tables reconciling non-GAAP measures, together with definitions of these
measures and the reasons management uses these measures, are attached to and
are part of this news release. Please see the link below.

About Constellation Brands, Inc.

Constellation Brands is the world's leading premium wine company that achieves
success through an unmatched knowledge of wine consumers, storied brands that
suit varied lives and tastes, and more than 4,400 talented employees
worldwide. With a broad portfolio of widely admired premium products across
the wine, beer and spirits categories, Constellation's brand portfolio
includes Robert Mondavi, Clos du Bois, Kim Crawford, Inniskillin, Franciscan
Estate, Mark West, Ruffino, Simi, Estancia, Corona Extra, Black Velvet
Canadian Whisky and SVEDKA Vodka.

Constellation Brands (NYSE: STZ and STZ.B) is a S&P 500 Index and Fortune
1000® company with more than 100 brands in our portfolio, sales in about 100
countries and operations in approximately 40 facilities. The company believes
that industry leadership involves a commitment to our brands, to the trade, to
the land, to investors and to different people around the world who turn to
our products when celebrating big moments or enjoying quiet ones. We express
this commitment through our vision: to elevate life with every glass raised.
To learn more about Constellation, visit the company's website at

Forward-Looking Statements

The statements made under the heading Outlook, and all statements other than
statements of historical fact set forth in this news release regarding
Constellation Brands' business strategy, future operations, financial
position, estimated revenues, projected costs, prospects, plans and objectives
of management, as well as information concerning expected actions of third
parties, are forward-looking statements (collectively, the "Projections") that
involve risks and uncertainties that could cause actual results to differ
materially from those set forth in or implied by the Projections.

During the current quarter, Constellation Brands may reiterate the
Projections. Prior to the start of the company's quiet period, which will
begin at the close of business on Feb. 28, 2013, the public can continue to
rely on the Projections as still being Constellation Brands' current
expectations on the matters covered, unless the company publishes a notice
stating otherwise. During Constellation Brands' "quiet period," the
Projections should not be considered to constitute the company's expectations
and should be considered historical, speaking as of prior to the quiet period
only and not subject to update by the company.

The Projections are based on management's current expectations and, unless
otherwise noted, do not take into account the impact of any future
acquisition, merger or any other business combination, divestiture,
restructuring or other strategic business realignments, financing or share
repurchase that may be completed after the date of this release. The
Projections should not be construed in any manner as a guarantee that such
results will in fact occur. The transaction between Constellation Brands and
Anheuser-Busch InBev SA/NV regarding the purchase by Constellation Brands of
the 50% portion of Crown Imports LLC which Constellation Brands does not
already own (the "Crown Acquisition") is subject to the satisfaction of
certain closing conditions, including receipt of necessary regulatory
approvals and the consummation of certain transactions between Anheuser-Busch
InBev SA/NV and Grupo Modelo, S.A.B. de C.V., and certain of its affiliates
(the "Modelo Transaction"). There can be no assurance the Crown Acquisition
will occur or will occur on the timetable projected by the company. The
availability of financing under the company's senior credit facility is
subject to satisfaction of the terms and conditions contained in the
underlying documents. 

In addition to the risks and uncertainties of ordinary business operations,
the Projections of the company contained in this news release are subject to a
number of risks and uncertainties, including:

  *completion of the Modelo Transaction;

  *completion of the Crown Acquisition; the availability of financing for the
    Crown Acquisition under the expected terms; and the accuracy of
    projections relating to the Crown Acquisition;

  *the exact duration of the share repurchase implementation and the amount
    and timing of any additional share repurchases;

  *achievement of all expected cost savings from the company's various
    restructuring plans and realization of expected asset sale proceeds from
    the sale of inventory and other assets; 

  *accuracy of the bases for forecasts relating to joint ventures and
    associated costs, losses, purchase obligations and capital investment

  *restructuring charges and other one-time costs associated with
    restructuring plans may vary materially from management's current
    estimates due to variations in one or more of anticipated headcount
    reductions, contract terminations, costs or timing of plan implementation;

  *raw material supply, production or shipment difficulties could adversely
    affect the company's ability to supply its customers; 

  *increased competitive activities in the form of pricing, advertising and
    promotions could adversely impact consumer demand for the company's
    products and/or result in lower than expected sales or higher than
    expected expenses; 

  *general economic, geo-political and regulatory conditions, prolonged
    downturn in the economic markets in the U.S. and in the company's major
    markets outside of the U.S., continuing instability in world financial
    markets, or unanticipated environmental liabilities and costs; 

  *changes to accounting rules and tax laws, and other factors which could
    impact the company's reported financial position, results of operations or
    effective tax rate; 

  *changes in interest rates and the inherent unpredictability of currency
    fluctuations, commodity prices and raw material costs; and 

  *other factors and uncertainties disclosed in the company's filings with
    the Securities and Exchange Commission, including its Annual Report on
    Form 10-K for the fiscal year ended Feb. 29, 2012, as supplemented by the
    company's Quarterly Report on Form 10-Q for the fiscal quarter ended May
    31, 2012, which could cause actual future performance to differ from
    current expectations.

Angela Howland Blackwell: 585-678-7141
Cheryl Gossin: 585-678-7191

Investor Relations
Patty Yahn-Urlaub: 585-678-7483
Bob Czudak: 585-678-7170

Q3 FY 13 Financial Tables


This announcement is distributed by Thomson Reuters on behalf of Thomson
Reuters clients.

The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and other
applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of
information contained therein.

Source: Constellation Brands Inc via Thomson Reuters ONE
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