Despite a slowdown in its wines and spirits business, Constellation Brands exceeded Wall Street expectations for first-quarter profit, driven by strong demand for its core beer brands. The company’s beer business, which includes popular brands like Modelo Especial and Pacifico, experienced a 6.4% increase in volume growth. This growth, coupled with aggressive price increases and lower marketing expenses, helped offset challenges from rising raw material and packaging costs.
Constellation Brands also saw its operating margin in the beer business increase to 40.6%. Despite these achievements, the company reported a comparable profit of $3.57 per share for the quarter, which slightly missed analysts’ estimates. However, shares of the company rose nearly 3% in premarket trading following the positive results.
The company maintained its annual forecasts despite the challenges faced by its wine and spirits division. Constellation Brands remains optimistic about the future of its core beer brands and is confident that they will continue to grow and perform well in the coming years.
