Corona brewer Constellation Brands Inc on Wednesday cut its profit outlook for fiscal 2019, citing weakness in its wine and spirits business and higher-interest expenses related to its investment in Canadian marijuana producer Canopy Growth Corp.
Net income attributable to the company fell to $303.1 million (€264.6 million), or $1.56 per Class A share, in the quarter ended 30 November 2018, from $492.8 million (€430.3 million), or $2.45 per share, a year earlier.
Operating margin decreased 60 basis points to 37.3% due to higher freight and marketing costs.
The maker of Modelo beers said net sales rose 9.5% to $1.97 billion (€1.7 billion), but missed the average estimate of $1.91 billion, according to IBES data from Refinitiv.
Constellation said it expects net sales and operating income at its wine and spirits unit, which makes Meiomi wines and Svedka vodka, to decline in low-single digits for fiscal 2019.
The company now expects earnings per share to be between $9.20 and $9.30, down from a prior forecast of $9.60 to $9.75 per share.