LONDON, UK / ACCESSWIRE / October 13, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Constellation Brands, Inc. (NYSE: STZ) ("Constellation"), which can be viewed by registering at http://protraderdaily.com/optin/'symbol=STZ, following the Company's reporting of its financial results on October 05, 2017, for the second quarter of the fiscal year 2018. The Company's revenue increased 3.6% on a y-o-y basis. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
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For the three months ended August 31, 2017, Constellation's revenue increased 3.6% to $2.30 billion from $2.22 billion in Q2 FY17. During Q2 FY18, the Company's net revenue increased 3% to $2.08 billion from $2.02 billion in Q2 FY17. For the reported quarter, the Company's organic net revenue increased 8% to $2.07 billion from $1.92 billion in Q2 FY17. The net revenue figures surpassed analysts' expectations of $2.06 billion.
During Q2 FY18, Constellation's gross profit increased 10.4% to $1.07 billion from $969.0 million in Q2 FY17. For the reported quarter, the Company's gross margin increased 350 basis points to 51.4% of revenue from 47.9% of revenue in Q2 FY17. For the reported quarter, the Company's adjusted gross profit increased 9.1% to $1.06 billion from $971.0 million in Q2 FY17.
For the reported quarter, Constellation's operating income increased 16.8% to $713.9 million from $610.9 million in Q2 FY17. For the reported quarter, the Company's operating margin increased 410 basis points to 34.3% of revenue from 30.2% of revenue in Q2 FY17. For the reported quarter, the Company's adjusted operating income increased 14.4% to $709.8 million from $620.2 million in Q2 FY17.
During Q2 FY18, Constellation's effective tax rate was 20.4% compared to 31.7% in Q2 FY17. For the reported quarter, the Company's adjusted effective tax rate was 20.5% compared to 31.8% in Q2 FY17.
During Q2 FY18, Constellation's net income increased 39.1% to $499.5 million on a y-o-y basis from $358.9 million in Q2 FY17. For the reported quarter, the Company's adjusted net income increased 36.4% to $497.1 million on a y-o-y basis from $364.4 million in Q2 FY17. During Q2 FY18, Constellation's diluted earnings per share (EPS) increased 41.7% to $2.48 on a y-o-y basis from $1.75 in Q2 FY17. For the reported quarter, the Company's adjusted diluted EPS increased 39.5% to $2.47 on a y-o-y basis from $1.77 in Q2 FY17. The adjusted diluted EPS surpassed analysts' expectations of $2.16.
On October 04, 2017, the Company's Board of Directors declared a quarterly cash dividend of $0.52 per share of Class A Common Stock and $0.47 per share of Class B Common Stock, payable on November 21, 2017, to stockholders of record as of the close of business on November 07, 2017.
Beer - During Q2 FY18, Constellation's Beer segment's net revenue increased 13.1% to $1.38 billion from $1.22 billion in Q2 FY17. For the reported quarter, the segment's gross margin increased 390 basis points to 54.2% of revenue from 50.3% of revenue in Q2 FY17. During Q2 FY18, the segment's operating margin increased 420 basis points to 41.1% of revenue from 36.9% of revenue in Q2 FY17. The increase was due to lower COGS, favorable pricing, and foreign currency benefits.
Wine and Spirits - During Q2 FY18, Constellation's Wine and Spirits segment's net revenue decreased 11.6% to $705.6 million from $798.7 million in Q2 FY17. For the reported quarter, the segment's gross margin increased 10 basis points to 44.6% of revenue from 44.5% of revenue in Q2 FY17. During Q2 FY18, the segment's operating margin increased 40 basis points to 26.2% of revenue from 25.8% of revenue in Q2 FY17. The increase was due to the divestiture of the lower-margin Canadian wine business and to a favorable mix.
As on August 31, 2017, Constellation's cash and cash equivalents decreased 29.1% to $125.6 million from $177.4 million in Q4 FY17.
During Q2 FY18, the Company's accounts receivable increased 15.7% to $853.3 million from $737.0 million in Q4 FY17.
For the reported quarter, Constellation's inventories decreased 1.5% to $1.93 billion from $1.96 billion in Q4 FY17.
For the reported quarter, the Company's accounts payable increased 7.4% to $601.7 million from $559.8 million in Q4 FY17.
During H1 FY17, the Company's cash provided by operating activities increased 5.7% to $1.10 billion from $1.04 billion in H1 FY16. During H1 FY17, Constellation's free cash flow decreased 11.6% to $597.8 million from $676.3 million in H1 FY16.
For FY18, Constellation expects EPS to be in the range of $7.90 - $8.05 and adjusted diluted EPS to be in the band of $8.25 - $8.40. The Company estimates free cash flow to be in the range of $725.0 million - $825.0 million for the fiscal year 2018.
At the closing bell, on Thursday, October 12, 2017, Constellation Brands' stock fell slightly by 0.16%, ending the trading session at $207.40. A total volume of 1.29 million shares have exchanged hands, which was higher than the 3-month average volume of 1.23 million shares. The Company's stock price surged 4.58% in the last three months, 22.76% in the past six months, and 22.00% in the previous twelve months. Moreover, the stock soared 35.28% since the start of the year. The stock is trading at a PE ratio of 27.58 and has a dividend yield of 1.00%. The stock currently has a market cap of $38.87 billion.
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