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Constellation spirits suffer double-digit fall
Mi Campo Tequila owner Constellation Brands saw wine and spirits net sales fall by 12% in the second quarter (Q2) of fiscal 2025.
Total sales grew by 3% to US$2.9 billion, led by 6% growth for its beer brands.
The fall in wine and spirits was driven by a 9.8% decrease in shipment volumes, with the firm citing ‘challenging market conditions, primarily in the US wholesale channel across most price segments in the wine category’.
Total wine and spirits sales were US$388.7 million.
Spirits fell by 13% to US$52.5m. The firm said this loss was due to ‘mainstream spirits depletion volumes’, and cited its craft spirits portfolio as a success. Mi Campo depletions increased by 23% and Nelson’s Green Brier by 15%.
Constellation’s other spirits brands include Svedka Vodka, Casa Noble Tequila and High West whiskey.
For the full fiscal year, the firm confirmed its updated forecast of a net sales decline of 4%-6%, which it announced last month. It estimated a combined non-cash goodwill impairment loss of between US$1.5bn and US$2.5bn for wine and spirits in Q2.
It had previously forecast a stagnant year for the division. The firm’s Q1 results saw spirits soar by 7% despite a 9% fall for wine.
Bill Newlands, the firm’s president and CEO, said: “While the current macroeconomic backdrop has weighed on demand for beverage alcohol – and for consumer packaged goods, more broadly – we continued to deliver a strong performance in Q2 of fiscal 2025.
“Our company once again outperformed the dollar sales growth of the total CPG [consumer packaged goods] sector, and our beer business remained both the number-one share gainer in its category and a top-three share gainer in the broader beverage industry.
“Our relentless focus on delivering top-tier growth and winning in the marketplace, as well as on driving efficiencies, supported another quarter with a double-digit increase in comparable EPS [earnings per share], in line with our full-year outlook.”
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