Global drinks company Constellation Brands has reported a 12% growth in net sales for fiscal year 2017.
Net sales for the beer business increased 17$. This was due to a 13% increase in organic net sales driven primarily by volume growth and favorable pricing, the company says, and the acquisition benefit from Ballast Point.
“Our beer business continues to be a powerhouse for growth. We exceeded our profit and margin goals for the year,” says Rob Sands, president and chief executive officer, Constellation Brands, in a press release. “These excellent results were driven by solid performance for every brand in our portfolio, which resulted in Constellation being the #1 growth contributor to the U.S. beer industry for the year. In addition, our portfolio posted industry-leading depletion growth in the 9 to 10 percent range for the first calendar quarter of 2017 after a challenging December for the U.S. beer industry,” said Sands.
Wine and spirits net sales increased 6%. This reflects a 4% increase in organic net sales on a constant currency basis driven primarily by volume growth and favorable mix, the company says, and the acquisition benefit primarily from Meiomi and Prisoner. These benefits were partially offset by the divestiture of the Canadian wine business.
“Our wine and spirits business achieved strong earnings growth and margin expansion driven by our fast-growing, high-margin Focus Brands, which collectively delivered depletion growth of nine percent for the year,” says Sands. “We continue to gain distribution for our newly acquired High West whiskey brands, as well as the Prisoner and Charles Smith wine brands, all of which posted strong, double-digit depletion growth for the year.”
The company completed the sale of its Canadian wine business to Ontario Teachers’ Pension Plan on December 17, 2016. The transaction was valued at $775 million and the company received cash proceeds, net of outstanding debt and direct costs to sell, of $575 million, subject to post-closing adjustments.