Constellation Brands Net Down on Low Prior-Year Tax Rate
Constellation Brands Net Down on Low Prior-Year Tax Rate
Oct 6, 2012 6
(WSJ) - Constellation Brands Inc. (STZ), which reported a bigger-than-expected quarterly profit Friday, said grape prices are expected to swell with a growing harvest this year. But wine makers are keeping a lid on prices in the company's more affordable brands, which could support sales volumes.
Chief Executive Rob Sands told analysts during a conference call the company expects this year's domestic grape harvest to show high-single-digit percentage growth from 2011's short harvest. Prices are expected to rise similarly, but would fluctuate depending on variety, location and demand trends.
Still, Mr. Sands said the company is seeing "little or no pricing movement" for wines priced between $5 and $15, a range that represents the bulk of Constellation's portfolio. He sees moderate promotional pricing for domestic wines that sell for less than $5 and reduced promotional activity for those above $15.
Comments