US-based, ASX listed wine company, Constellation Brands Inc
(ASX:CBR), has reported operating income of US$96 million for the first quarter of fiscal 2011.
On a comparable basis operating income for the three months to May 31 came to US$103 million down on the same time last year.
The decline in comparable basis operating income was primarily driven by a US$15 million decrease in the North American wine segment as a result of higher promotion spending.
For the quarter Constellation Brands reported net sales of US$788 million, net income of US$49 million and comparable net income of US$83 million.
CEO Rob Sands says the first quarter results represent a solid start to the year, with the company on track to achieve its strategic and financial goals.
Mr Sands says that while macroeconomic and competitive challenges persist, the company is encouraged by improving market trends in its US wine and beer businesses.
Looking ahead the company says it expects diluted earnings per share for fiscal 2011 to be between US$1.33 and US$1.48 compared to US$0.45 reported for fiscal 2010.
The company also anticipates generating strong free cash flow in the range of US$350 and US$400 million.
For the year ending February 28, 2010, Constellation Brands reported net profit after tax of $111.59 million.
