Constellation Brands Q2 Profit Tops Views

reported stronger-than-expected earnings for its fiscal second quarter. The Victor, New York-based company's quarterly net income surged more than 50 percent year-over-year to $302 million, or $1.49 per share. Excluding items, the company's adjusted earnings came in at $1.56 per share. Its sales climbed 8 percent to $1.73 billion. However, analysts were expecting a profit of $1.32 per share on revenue of $1.73 billion. The average estimate among 32 Estimize users was for earnings of $1.33 per share and revenue of $1.73 billion. Its operating income surged 27 percent year-over-year to $479 million in the latest quarter. Beer net sales rose 14 percent in the quarter. For the first six months of fiscal 2016, free cash flow rose to $508 million, versus $360 million in the year-ago period. On October 6, 2015, the company's board declared a quarterly cash dividend of $0.31 per share of Class A Common Stock and $0.28 per share of Class B Common Stock. "We posted outstanding results for our second quarter driven by the impressive, sustained momentum of our beer business, which is also driving an increase in our EPS projection for the year. I am pleased that our glass plant and Nava brewery expansions continue to progress as planned, with our first incremental five million hectoliters of capacity scheduled to become operational by calendar year end. Our wine and spirits business posted improved margins, strong sales growth for our spirits portfolio and excellent financial results for our Canadian business," said Rob Sands, president and chief executive officer, Constellation Brands. Constellation Brands expects FY16 GAAP earnings of $4.73 to $4.93 per share and adjusted earnings of $5 to $5.20 per share. For fiscal 2016, the beer business now projects operating income to rise in the 15 percent to 18 percent range. Constellation Brands shares fell 0.71 percent to close at $131.30 yesterday.