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Check Out Line: Drinking up profits at Constellation

October 1, 2009

Check out the rising spirits at Constellation Brands. CORONA
 
The maker of Svedka vodka and Robert Mondavi wine posted a $99.7 million profit in the second quarter, compared with a year earlier loss. 

But it’s not because people are buying much more booze in the recession. In fact, sales fell 8 percent, though they rose 4 percent if you factor out issues like currency rate changes and divestitures.

Quarterly earnings of 54 cents a share were 13 cents ahead of analysts estimates.

The company has sold off some less-expensive brands and is cutting jobs to try to save costs.  It has also cut debt by more than $1 billion since early 2008.

But people are still not buying as much at restaurants and convenience stores, keeping pressure on sales.
 
As part of a joint venture, Constellation is trying targeted promotions and new packages like 24-ounce cans of Corona beer to try to boost sales in those channels.
 
Also in the basket:

Christmas orders bring labor shortages in China export hubs
 
Personal spending surges, jobless claims rise
 
Macy’s said in exclusive deal with Ellen Tracy (WWD, subscription required)

(Reuters photo)

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