Business Context and Reporting Period
Company: Constellation Brands, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: January 4, 2007
Reporting Period: Third fiscal quarter ended November 30, 2006.
Context: This filing announces the results of operations and financial condition for the third fiscal quarter. The report incorporates a press release (Exhibit 99.1) by reference and includes non-GAAP financial measures (comparable, organic, constant currency) to evaluate underlying business trends.
Key Financial Metrics
Revenue, Profit, Cash Flow, Margins, Debt, Liquidity: The provided filing text does not contain specific numerical values for revenue, profit, cash flow, margins, debt, or liquidity. These figures are contained within the attached press release (Exhibit 99.1), which is incorporated by reference but not included in the text of this 8-K summary.
Material Changes and Non-GAAP Adjustments
The filing details specific items excluded from "comparable" and "organic" results to reflect underlying performance. These exclusions include:
- Adverse grape cost flow-through and inventory step-up associated with acquisitions.
- Accelerated depreciation and inventory write-downs related to restructuring and integration activities.
- Acquisition-related integration costs and restructuring charges.
- Write-off of deferred financing fees.
- Loss on the sale of the branded water business.
- Gain on change in fair value of derivative instruments hedging foreign currency denominated acquisitions.
- Foreign currency losses on intercompany loan balances.
- Due diligence costs for the potential offer for Allied Domecq.
- Income tax adjustments related to the reversal of accruals from tax examinations.
Acquisition Context: The Company acquired Vincor International Inc. on June 5, 2006. Organic net sales measures exclude Vincor product sales during the indicated periods.
Guidance, Outlook, and Risks
Guidance: The press release includes projections and guidance. Management states these involve risks and uncertainties, and actual results may vary materially from forecasts.
Forward-Looking Statements: Investors are directed to the "Forward-Looking Statements" section of the press release for details on risks.
Regulatory Status: The information in this Item 2.02 and the press release is "furnished" and not "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, limiting liability under that section.
Investor Verification Checklist
- Review Exhibit 99.1 (Press Release) for specific numerical values regarding revenue, net income, and cash flow for the quarter ended November 30, 2006.
- Verify the reconciliation of non-GAAP measures (comparable/organic) to GAAP measures provided in the press release.
- Assess the impact of the Vincor International Inc. acquisition on year-over-year comparisons.
- Examine the "Forward-Looking Statements" section in the press release for specific risks related to the provided guidance.
- Confirm the status of the potential offer for Allied Domecq and associated due diligence costs.