US drinks company Constellation Brands toasted a successful second quarter today as its profit rose to beat expectations.
Constellation, which sells Corona Extra and Modelo beers in the US, said its net sales rose three per cent to $2.08bn (£1.58bn) in the quarter ending 31 August compared with the previous year. Net beer sales were particularly strong, rising 12.8 per cent.
Net income attributable to the company rose to $500m or $2.48 per Class A share from $358.9m or $1.75 per Class A share.
Analysts on average predicted a profit of $2.16 per share and revenue of $2.06bn, according to Thomson Reuters.
The positive results sent shares to open at a record high. At time of writing, the firm's New York-listed shares were down from the high but still up 5.08 per cent at 211.4p.
Why it's interesting
Constellation beat Wall Street's profit estimate for the ninth quarter in a row thanks to increased margins from higher beer prices and breweries running at full capacity during the summer.
A marketing campaign over the summer drove market share gains in the firm's beer business between key US holidays at the start and end of the season.
During the period the company acquired fast-growing craft beer brand Funky Buddha, advancing its strategy of leading the high-end of the US beer market.
Constellation lifted its full-year profit forecast to between $8.25 and $8.40 per share from between $7.90 to $8.10 per share.
What Constellation Brands said
Rob Sands, president and chief executive, said:
Our second quarter results are a testament to the fact that our total beverage alcohol (TBA) strategy is paying off. We remain the leader in the high-end of the US beer market, and we are reaping the benefits of our wine and spirits premiumisation efforts.
Strong execution, coupled with smart portfolio and operational investments, continue to fuel our growth and solidify our leadership position across TBA.