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May 31, 2024
Constellation Brands Q1 2025 Earnings Report
Constellation Brands had a solid start to fiscal 2025, driven by strong volume growth in the beer business and operating margin expansion. The company returned over $240 million to shareholders through share repurchases in June 2024.
Key Takeaways
Constellation Brands reported a 6% increase in net sales and a 23% increase in operating income. The beer business achieved strong high single-digit net sales growth and double-digit operating income growth. The wine and spirits business is implementing actions to improve net sales and operating income.
Generated reported EPS of $4.78 and comparable EPS of $3.57.
Beer Business achieved strong high single-digit net sales growth and double-digit operating income growth primarily driven by continued volume growth and cost savings initiatives.
Wine and Spirits Business initiates commercial and operational actions expected to drive net sales and operating income improvements and affirms fiscal 2025 outlook.
Generated first quarter operating cash flow of $691 million, a 4% increase, and free cash flow of $315 million, a 19% decrease, driven by brewery capacity investments.
Constellation Brands
Constellation Brands
Constellation Brands Revenue by Segment
Constellation Brands Revenue by Geographic Location
Revenue by Segment
Beer Revenue
CapyFin.comWine & Spirits Revenue
CapyFin.comRevenue by Geographic Location
U.S. Revenue
CapyFin.comInternational Revenue
CapyFin.comDirect-to-Consumer Revenue
CapyFin.com Forward Guidance
Constellation Brands provided guidance for fiscal year 2025, including net sales growth of 6-7%, beer net sales growth of 7-9%, and wine and spirits net sales decline of 0.5% to growth of 0.5%.
Positive Outlook
- Enterprise: net sales growth of 6 - 7%
- Beer: net sales growth of 7 - 9%
- Enterprise: operating income growth: reported of 10 - 12% and comparable of 8 - 10%
- Beer: operating income growth of 10 - 12%
- Operating cash flow: $2.8 - $3.0 billion
Challenges Ahead
- Wine and Spirits: net sales decline of 0.5% to growth of 0.5%
- Wine and Spirits: operating income decline of 9 - 11%
- Corporate expense: $260 million
- Interest expense, net: $445 - $455 million
- Capital expenditures: $1.4 - $1.5 billion, including approximately $1.2 billion targeted for Mexico beer operations activities
Revenue & Expenses
Visualization of income flow from segment revenue to net income