I came across this report from Associated Press about the impact the recession is having on Constellation, the world’s largest wine company.
“Constellation Brands Inc. said Wednesday that its fiscal first-quarter profit slid 85 percent partly on increased restructuring charges, but the wine company’s adjusted results still beat Wall Street expectations.
“The world’s biggest wine company by volume earned $6.5 million, or 3 cents per share, down from $44.6 million, or 20 cents per share, in the same period a year ago.
“Excluding restructuring charges and other items, profit was 33 cents per share for the quarter ended May 31. That narrowly topped the 32 cents-per-share estimate of analysts polled by Thomson Reuters. Analysts’ estimates normally exclude one-time items.
“Sales for the company, whose brands include Robert Mondavi wines and Svedka brand vodka, dropped 15 percent to $791.6 million from $931.8 million on the stronger dollar as well as the sales of the value spirits business, spirits contract production services and some Pacific Northwest wine brands.
“The results managed to surpass Wall Street’s estimate of $780.9 million.
“Quarterly sales of its spirits tumbled 43 percent to $60.1 million, while branded wine sales fell 10 percent to $687.9 million.
“Constellation Brands, which also markets Corona beer, said it has fine tuned its strategy during the recession — concentrating on brands that provide a good value to budget-conscious shoppers.”