Constellation Sees Stars: Fool by Numbers

On Jan. 4, Constellation Brands (NYSE: STZ) released fiscal 2007 third-quarter earnings for the period ended Nov. 30, 2006. Here are the quick-and-dirty details for the quarter.

• Sales grew 18.4% to $1.5 billion, primarily because of the acquisition of Vincor.
• Total diluted earnings fell 2.2% and came in below analyst projections.
• Because of challenges in the U.K. market, management decreased earnings expectations for full-year 2007 to $1.65-$1.70 per share, from $1.72-$1.76.
• Constellation Brands has a three-star ranking in Motley Fool CAPS. To read what the community thinks or to add your opinion, log onto CAPS.

(Figures in millions, except per-share data)

Income Statement Highlights

	Q3 2007	Q3 2006	Change
Sales	$1,501	$1,267	18.4%
Net Profit	$108	$109	(1.1)%
EPS	$0.45	$0.46	(2.2%)
Diluted Shares	239.4	238.6	0.3%

Get back to basics with a look at the income statement.

Margin Checkup

	Q3 2007	Q3 2006	Change*
Gross Margin	29.66%	30.32%	(0.66)
Operating Margin	15.71%	17.47%	(1.76)
Net Margin	7.18%	8.60%	(1.23)

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets	Q3 2007	Q3 2006	Change
Cash + ST Invest.	$35	$26	31.6%
Accounts Rec.	$1,160	$970	19.6%
Inventory	$2,139	$1,806	18.4%

Liabilities	Q3 2007	Q3 2006	Change
Accounts Payable	$543	$486	11.9%
Long-Term Debt	$3,949	$2,592	52.4%

Learn the ways of the balance sheet.

Cash Flow Highlights

	YTD 2007	YTD 2006	Change
Cash From Ops.	$118	$282	($164)
Capital Expenditures (Inflows)	$127	($28)	$154
Free Cash Flow	($9)	$310	($319)

Find out why Fools always follow the money.

Comparable companies:

• Fortune Brands (NYSE: FO)
• Diageo (NYSE: DEO)
• Brown-Forman (NYSE: BF-B) (NYSE: BF-A)

Related Foolishness:

• Constellation Brands Chugs Ahead
• Constellation Bottles Another Quarter: Fool by Numbers
• Constellation: 10 Years Away From Ordinary
• Constellation Brands a Little Flat

Diageo is an Income Investor selection. To see what other great companies have been recommended, take a free 30-day trial today.

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.

Fool contributor Ryan Fuhrmann is long shares of Diageo but has no financial interest in any other company mentioned. Feel free to email him with feedback or to discuss any companies mentioned further. The Fool has an ironclad disclosure policy.