Constellation Brands (NYSE: STZ) beat revenue and earnings estimates for the third quarter of 2020, sending the stock climbing over 4% in premarket hours on Wednesday.
Revenue totaled around $2 billion, up 1% from the same period a year ago, beating forecasts of $1.95 billion.
Reported net income was $360.4 million, or $1.85 per share, compared to $303.1 million, or $1.56 per share, last year. Comparable EPS totaled $2.14, surpassing estimates of $1.85. Comparable EPS, excluding Canopy Growth equity losses, amounted to $2.39.
During the quarter, net sales of Beer increased 8.3% to $1.31 billion. The beer business posted overall depletion growth of 7.3% driven by Modelo Especial. The launch of Corona Seltzer is planned for the start of fiscal 2021.
Net sales in the Wine and Spirits division dropped 9.7% to around $689 million. Power Brand depletion volume grew 3.3%.
For fiscal year 2020, Constellation raised its earnings guidance and now expects reported EPS of $0.95-1.05. On a comparable basis, excluding Canopy, EPS is expected to be $9.45-9.55. This compares to the prior ranges of reported EPS of $0.55-0.75 and adjusted EPS of $9.00-9.20.
The company expects net sales in Beer to grow 7-8% and net sales in Wine and Spirits to decline 8-10%.
On January 7, the board of directors declared a quarterly cash dividend of $0.75 per share of Class A common stock and $0.68 per share of Class B common stock, payable on February 25, to stockholders of record as of February 11, 2020.
Constellation’s share of Canopy Growth’s equity earnings and related activities totaled a gain of $46.2 million on a reported basis and a loss of $71.1 million on a comparable basis.