Business Context and Reporting Period
Company: Constellation Brands, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: June 29, 2016
Reporting Period: First quarter ended May 31, 2016.
Context: This filing announces the Company's financial condition and results of operations for the first quarter of fiscal 2016 via a news release (Exhibit 99.1). The filing also declares a quarterly cash dividend.
Key Financial Metrics
Revenue, Profit, Cash Flow, Margins, Debt, and Liquidity: The filing text does not provide specific numerical values for revenue, profit, cash flow, margins, debt, or liquidity. These figures are contained within the attached news release (Exhibit 99.1), which is incorporated by reference but not reproduced in the text of this 8-K.
Dividend Declaration:
- Class A Common Stock: $0.40 per share
- Class B Common Stock: $0.36 per share
- Class 1 Common Stock: $0.36 per share
- Record Date: August 10, 2016
- Payment Date: August 24, 2016
Material Changes and Acquisitions
The filing highlights recent acquisitions that impact the calculation of "organic" and "comparable" financial measures:
- Meiomi: Acquired on August 3, 2015.
- Ballast Point Brewing & Spirits: Acquired on December 16, 2015.
- The Prisoner Wine Company: Acquired on April 29, 2016.
Organic net sales measures exclude the net sales of these acquired brands to allow for year-over-year trend analysis of core operations.
Guidance, Outlook, and Non-GAAP Measures
Guidance and Outlook: The referenced news release contains forward-looking projections and guidance. The filing explicitly states that actual results may vary materially from these forecasts due to risks and uncertainties.
Non-GAAP Measures: Management utilizes "comparable," "organic," and "constant currency" measures to evaluate business trends. These measures exclude specific items, including:
- Net gain/loss on mark-to-fair value of undesignated commodity derivative contracts.
- Settlements of undesignated commodity derivative contracts.
- Inventory step-up flow-through from acquisitions.
- Transaction, integration, and acquisition-related costs.
- Costs related to a potential IPO of the Canadian wine business.
- Restructuring charges and loss on write-off of financing costs.
- Dividend income from retained interests in divested businesses.
Reconciliations to GAAP measures are provided in the attached news release.
Investor Verification Checklist
- Review Exhibit 99.1 (News Release dated June 30, 2016) for specific revenue, earnings, and cash flow figures.
- Verify the reconciliation of non-GAAP "organic" and "constant currency" metrics to GAAP results in the news release.
- Confirm the impact of the April 2016 Prisoner Wine Company acquisition on current quarter comparability.
- Assess the risks associated with the forward-looking guidance mentioned in the release.
- Note the dividend payment schedule for August 24, 2016.