Constellation Posts Flat Sales, With Wine And Spirits Depletions Down 4%
Constellation Brands saw overall sales come in flat at $2.5 billion for the fiscal third quarter ended in November, with operating profit dipping 2% to $802 million on a comparable basis against the previous year. Amid an uncertain consumer environment, the company lowered its sales and operating income expectations for its full fiscal year ending in February.
“While we continue to face the subdued spend and value seeking behaviors that emerged among legal drinking age consumers in Q2, our beer business delivered a sequential increase in our depletions growth rate in Q3,” noted Constellation president and CEO Bill Newlands. “That said, given near-term uncertainty on when consumers will revert to more normalized spending, we have prudently lowered our growth outlook for net sales and operating income.”
Constellation’s beer unit accounted for 82% of sales in the third quarter, and grew sales 3% to $2 billion, with operating income up 2% to $770 million. Growth was led by Modelo Especial, Pacifico, and Modelo Chelada, while Corona Extra saw depletions slip 1%.
The wine and spirits division saw depletions decline 4%, but shipments fell a more substantial 16% to 5.1 million cases, leading net sales to decrease 14% to $431 million. Operating income for the unit was down 25% to $95 million. The declines were “mostly driven by ongoing weaker consumer demand and continued retailer inventory destocking across most price segments in the U.S. wholesale market,” the company explained.
Constellation recently offloaded the 3.5-million-case Svedka vodka brand to Sazerac for an undisclosed sum, noting that the divestiture continues its strategy of focusing on higher-margin brands. “Our remaining spirits portfolio, which is focused on higher-end craft spirits brands, delivered depletion growth of approximately 9%, driven by Mi Campo Tequila posting growth over 30%,” the company said. On the wine side, The Prisoner and Unshackled both grew in retail channels last year through November, while Kim Crawford, Meiomi, Ruffino Prosecco, and Simi all slipped.
The wine and spirits division is expected to see sales decrease 5% to 8% for Constellation’s full fiscal year, with operating income falling 17% to 19%, while the beer unit is expected to tally net sales and operating income growth of between 4%-7% and 9%-12% respectively.—Daniel Marsteller
| Constellation—Leading Wine & Spirits in the U.S. Retailing at $15 & Up | ||||||
| Brand | Origin/Type | Total 2023 U.S. Depletions1 |
Volume Growth 2024 YTD2 |
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|---|---|---|---|---|---|---|
| Wine: | ||||||
| Kim Crawford | New Zealand | 1,840 | -2.8% | |||
| Meiomi | California | 1,809 | -2.3% | |||
| Ruffino Prosecco | Italy | 520 | -24.7% | |||
| Simi | California | 498 | -4.3% | |||
| The Prisoner | California | 285 | 1.6% | |||
| Unshackled | California | 195 | 4.0% | |||
| Spirits: | ||||||
| High West | American Whiskey | 170 | 2.8% | |||
| Mi Campo | Tequila | 161 | 0.03% | |||
| Casa Noble | Tequila | 50 | 35.3% | |||
| Nelson Bros. | American Whiskey | 17 | -39.9% | |||
| Copper & Kings | Brandy | 5 | 9.5% | |||
| 1 Thousands of 9-liter cases. 2 52 weeks ending 12/29/24 in IRI/Circana channels for wine and year-to-date ending November 2024 in control states for spirits. Source: IRI/Circana, Nabca, and IMPACT DATABANK © 2025 |
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Tagged : Constellation Brands, High West, Kim Crawford, Meiomi, Mi Campo, Ruffino, The Prisoner
