A summer of boisterous brunches is taking shape as the global economy continues to recover from the COVID-19 pandemic.
“We’re seeing a lot of people moving back to the on-premises system, which is obviously good for us,” Constellation Brands CEO Bill Newlands said on Yahoo Finance Live.
The manufacturer of Corona and Modelo beer showed signs of a bar recovery.
Constellation Brands announced this week that its fiscal fourth quarter revenue rose 8% year over year. Despite inflationary pressures in areas like labor and packaging, the company’s operating profit rose 17% year over year.
Beer sales rose 14% for the quarter, faster than the 11% gain for the full fiscal year. Wine sales were down 7% year-on-year.
“Modelo is on fire,” added Newlands.
Modelo beers are featured at a BevMo! Business ahead of Constellation Brands Inc company results in Pasadena, California, U.S. October 4, 2016. REUTERS/Mario Anzuoni
Here’s how Constellation Brands compared to Wall Street earnings forecasts:
Constellation issued a relatively optimistic forecast for the new fiscal year.
For the full fiscal year, Constellation expects beer sales to grow 7% to 9% and wine sales to decline 1% to 3%. The company is targeting earnings of $11.20 to $11.50 per share for the year. Analysts had expected $11.27 per share.
“Overall, we depart from Constellation’s FY4Q22 results as we view the company’s FY23 outlook as relatively conservative, particularly on beer profits/margin. Whilst we agree that the cost environment remains challenging across the supply chain, beer demand remains remarkably resilient. The company has a relatively solid view of its cost structure through the hedges implemented and its planned pricing actions are admittedly ‘reasonable’ – and will continue for the year Opportunities remain for greater price/mix and higher margins,” said Steve Powers, analyst at Deutsche Bank.
Brian Soci is a freelance editor and Anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and further LinkedIn.
The story goes on
Follow Yahoo Finance on Twitter, Facebook, Instagram, flipboard, LinkedIn, youtubeand reddit