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Constellation sales robust

Published:  23 July, 2008

The world's largest wine producer, Constellation Brands, increased its earnings in the three months to the end of May by 13%, which was more than analysts expected. Net sales were up 5% to $1.2bn, a record for the group in the first quarter of its financial year, which did not include a contribution from Vincor, the Canadian group purchased by Constellation earlier this year.

The results underlined the American consumer's switch from domestic beer brands towards wine, spirits and imported beer, in which Constellation is a big player. Sales of branded wines grew by 6%, with North America leading the way but Europe, Australia and New Zealand showing declines.

Richard Sands, chairman and chief executive, said Constellation had sprinted out of the starting gate this year and expressed confidence about the remainder of 2006.

Net income rose to $86m, or 36 cents per share, beating forecasts of 32 cents a share. Sales after duties grew 5% to $1.16bn.