On Wednesday, Constellation Brands Inc., the Corona maker, said that it was planning to sell some of its lower-end wine brands. The announcement comes as it concentrates on the more profitable high-end segment.
At CAGNY, a major food and consumer products event that was held in Boca Raton, Florida, David Klein, the Chief Financial Officer of the company, stated: “Everything that’s not a power brand, you can assume that we’re either going to sell it, discontinue it or milk it very quickly over the next year or so.”
Last October, Reuters reported that Constellation was planning to sell some of its wine brands that are based in the United States of America, in a deal that could be worth more than $3 billion (2.3 billion pounds).
On Wednesday, Klein also said that he expects the third-quarter results of Canopy Growth Corp, a Canadian marijuana producer, to hit the current-quarter earnings of Constellation by approximately 10 cents per share.
Constellation has invested more than $4 billion in Canopy. Last week, Canopy reported a quarterly loss amounting to 38 Canadian cents per share. According to IBES data from Refinitv, The figure is bigger as compared to the estimates some analysts of a loss of 16 Canadian cents per share.
The shares of Constellation closed down 4.4 percent on Wednesday.
The firms also said that it is expecting its earnings per share to increase at a rate of 10 percent over the next three years.