Constellation Brands (STZ) revealed surging fourth-quarter profits on Wednesday that trumped expectations as the wine and spirits company capitalized on soaring sales of beers like Corona and Modelo Especial.
The strong beer sales come in the wake of Constellation’s $5.3 billion deal to acquire U.S. distribution rights for Corona, Modelo and other Mexican beers last year.
The company said it earned $157.2 million, or 79 cents a share, last quarter, compared with a profit of $81.7 million, or 43 cents a share, a year earlier.
Excluding one-time items, it earned 81 cents a share, easily topping the Street’s view of 76 cents.
Revenue soared 86% to $1.29 billion, matching consensus calls from analysts.
“Our beer business exceeded our expectations for the year fueled by robust consumer demand, strong sales execution and support from our wholesalers, as well as creative, new marketing and advertising programs,” Constellation CEO Rob Sands said in a statement, noting that Modelo Especial is the fastest growing major beer brand.
Net sales for Constellation’s beer segment jumped 13% in the fourth quarter due to volume growth driven by strong consumer demand.
Constellation, which makes Svedka Vodka and Robert Mondavi wine, said wine and spirits net sales increased 1% last quarter on an organic constant currency basis. However, the company said volume growth was largely offset by unfavorable mix and higher promotional spending.
Looking ahead, Constellation projected 2015 non-GAAP EPS of $3.95 to $4.15. Analysts had been calling for EPS of $3.95. Management sees free cash flow of about $425 million to $500 million in 2015.
Shares of Victor, N.Y.-based Constellation advanced 3.46% to $84.30 in premarket trading on Wednesday morning. Constellation has rallied 16% this year and almost 68% over the past 12 months.