Shop Talk
Retailers, consumers and prices
Check Out Line: Consumers spending again, just not drinking much
Check out Constellation Brands’ lack of optimism.
Even though shoppers are returning in droves to malls to buy clothes and shoes, based on retailers’ boffo business in March, they are more sober -literally- in their spending on booze.
Constellation, which makes Robert Mondavi wine and owns the Svedka vodka brand, managed to squeeze out a bigger operating profit during its fourth quarter, despite a 3.5 percent drop in sales. It also owns half of a joint venture that imports beers like Corona, but said those sales fell 4 percent.
CEO Rob Sands apparently found little to toast about as he looks ahead. The company gave a disappointing profit forecast partly because of how dodgy the economic recovery is and how weak imported beer sales look to remain.
His caution appears to be well placed. A study by business advisory firm AlixPartners conducted in February and released on Friday found that about 89 percent of U.S. consumers (sample size of 1,000) plan on spending the same or less on booze in 2010.
Check Out Line: Drinking up profits at Constellation
Check out the rising spirits at Constellation Brands. 
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.
Constellation’s holiday drink sales less than stellar – CEO
With so many forecasters talking about the 2008 holiday season in extremes (the weakest since 1970, one of the worst in modern times), it’s refreshing to hear an executive suggest that, ok, things were not great, but they weren’t horrible either.
That assessment came on Wednesday from Rob Sands, chief executive of Constellation Brands, when the world’s largest wine producer and maker of Robert Mondavi, Vendage and Ravenswood wines reported third-quarter earnings.
Check Out Line: Spirited Sales
Check out rising spirits sales at Constellation Brands.
Today’s winner in the consumer products arena is wine, which looks to be a must-have item as higher gasoline prices demand more of consumers’ paychecks.
Constellation Brands, which makes Robert Mondavi wine and Svedka vodka, reported better-than-expected quarterly profit on strong sales, and backed its full-year outlook.
-
Resident Shop Talk Expert
-
