Constellation Reports Record Fourth Quarter and Fiscal 2001 Results

Earnings Per Share Up 16% for the Quarter and 25% for the Year

Company Announces Stock Split



Apr 12, 2001, 01:00 ET from Constellation Brands, Inc.

    FAIRPORT, N.Y., April 12 /PRNewswire/ -- Constellation Brands, Inc.
 (NYSE:   STZ and STZ.B), reported net income of $18 million for the three months
 ended February 28, 2001 ("Fourth Quarter 2001"), representing an 18 percent
 increase over net income reported for the three months ended February 29, 2000
 ("Fourth Quarter 2000").  Net income of $97 million for the twelve months
 ended February 28, 2001 ("Fiscal 2001") increased 26 percent over net income
 reported for the twelve months ended February 29, 2000 ("Fiscal 2000").
     (Logo:  http://www.newscom.com/cgi-bin/prnh/20000918/NYM167LOGO )
     Earnings per share on a diluted basis for Fourth Quarter 2001 and Fiscal
 2001 were $0.97 and $5.21, respectively, representing increases of 16 percent
 and 25 percent, respectively, when compared to Fourth Quarter 2000 and Fiscal
 2000 earnings per share.  For comparative purposes, net income for Fiscal 2000
 included pretax nonrecurring charges of $6 million, or the equivalent of $0.18
 per share on a diluted basis.
     The Company also announced that its Board of Directors has approved a
 two-for-one stock split of both its Class A Common Stock and Class B Common
 Stock to be distributed in the form of a stock dividend.  Stockholders of
 record on April 30, 2001, will receive an additional share of stock for each
 share held with distribution of the additional shares expected to occur on
 May 14, 2001.  The financial statements included in this press release do not
 reflect the effect of the stock split.
     Richard Sands, Chairman, Chief Executive Officer and President of
 Constellation said, "Once again, we demonstrated our commitment to
 stockholders by delivering double-digit earnings growth for the twelfth
 consecutive quarter. This performance was achieved with top-line growth in
 every part of our business, particularly fine wine and imported beer.  In
 addition, this year we expanded the higher-margin, faster growing categories
 of our premium wine business through the acquisitions of the Turner Road
 Vintners and Corus brands.  With the addition of these brands and Ravenswood,
 coupled with our existing portfolio of leading brands, Constellation is
 positioned to deliver another year of strong double-digit earnings per share
 growth."
     Sands added, "After such a successful year and a positive outlook, we are
 pleased to announce a two-for-one stock split.  This action underscores our
 confidence in the Company's ability to deliver strong performance, as well as
 our desire to enable greater investor participation in our Company.  By
 combining top line growth with margin improvements and deleveraging
 initiatives, Constellation is well-positioned to build on its track record of
 growing earnings and increasing stockholder value."
 
     Consolidated Results
     Net sales reached $544 million for Fourth Quarter 2001, a two percent
 increase over Fourth Quarter 2000.  After adjusting for foreign currency
 impact, net sales for Fourth Quarter were five percent greater than Fourth
 Quarter 2000.  Sales increased across all businesses for Fourth Quarter 2001,
 on a currency-adjusted basis, led by fine wine, imported beer and the U.K.
 wholesale business.  Net sales for Fiscal 2001 were $2.4 billion versus
 $2.3 billion for Fiscal 2000, an increase of two percent.  On a
 currency-adjusted basis, net sales increased five percent versus Fiscal 2000
 net sales driven by fine wine, imported beer and the U.K. wholesale business.
     Gross profit for Fourth Quarter 2001 was $165 million compared to
 $168 million in the prior period.  On a currency-adjusted basis, gross profit
 increased slightly for Fourth Quarter 2001 compared to the prior period as
 increased sales more than offset a decline in gross margin.  The decline in
 gross margin was due primarily to higher energy costs impacting spirits and
 higher tequila costs.  Reported gross profit and gross margin for Fiscal 2001
 increased to $757 million and 31.6 percent, respectively, compared to
 $722 million and 30.9 percent, respectively, for Fiscal 2000.  The margin
 improvements were driven primarily by price increases in the fine wine
 business as well as cost improvements in the Company's U.K. business, Matthew
 Clark.
     Fourth Quarter 2001 selling, general and administrative expenses as a
 percent of net sales were favorable by 150 basis points versus the comparable
 quarter a year ago, declining from 21.2 percent to 19.7 percent.  Selling,
 general and administrative expenses were $107 million for Fourth Quarter 2001
 compared to $114 million reported for the same period last year.  The decrease
 is primarily attributable to lower marketing costs and corporate expenses.
 For Fiscal 2001, selling, general and administrative expenses as a percent of
 net sales decreased to 20.3 percent compared to 20.6 percent for the prior
 year.  Selling, general and administrative expenses were $487 million, an
 increase of one percent from Fiscal 2000.
     Operating income for Fourth Quarter 2001 increased to $57 million from
 $54 million, an increase of seven percent versus the same period a year ago.
 Fiscal 2001 operating income of $271 million was $30 million, or 13 percent,
 higher than Fiscal 2000, excluding pretax nonrecurring charges.
     Net interest expense for Fourth Quarter 2001 decreased four percent to
 $27 million versus $28 million reported for the same period a year ago.  The
 lower interest expense was the result of lower average debt levels for Fourth
 Quarter 2001.  For Fiscal 2001, net interest expense increased two percent to
 $109 million versus $106 million reported for Fiscal 2000.  The increase in
 net interest expense can be primarily attributed to higher average interest
 rates.
     Net income and diluted earnings per share for Fourth Quarter 2001 were
 $18 million and $0.97, respectively, as compared to net income and diluted
 earnings per share of $16 million and $0.84, respectively, reported for Fourth
 Quarter 2000.  Fiscal 2001 net income grew 26 percent to reach $97 million
 versus net income reported for Fiscal 2000 of  $77 million.  Diluted earnings
 per share for Fiscal 2001 and Fiscal 2000 were $5.21 and $4.18, respectively,
 representing an increase of 25 percent.
 
     Barton Results
     Barton net sales for Fourth Quarter 2001 were $182 million, an increase of
 six percent versus the comparable quarter a year ago.  The increase can be
 attributed primarily to volume growth in imported beer and spirits offset by
 slightly lower contract manufacturing sales.  For Fiscal 2001, net sales grew
 13 percent to $945 million driven by the following: volume growth and price
 increases in the Mexican beer portfolio, volume growth in the spirits
 portfolio, price increases on tequila products and the inclusion of brands
 acquired in the Black Velvet acquisition for a full year.  On a pro forma
 basis, net sales for Fiscal 2001 increased 12 percent.
     Operating income grew to $32 million for Fourth Quarter 2001, an increase
 of 13 percent versus the comparable quarter last year.  Sales gains in
 imported beer and lower marketing spend on spirits, more than offset increased
 energy and tequila costs associated with spirits.  Fiscal 2001 and Fiscal 2000
 operating income was $168 million and $143 million, respectively, an increase
 of 17 percent.  Volume growth and average selling price increases in imported
 beer and volume growth in spirits accounted for the growth, partially offset
 by increased selling and marketing expenses related to growth of imported
 beer.
 
     Canandaigua Wine Results
     Canandaigua Wine net sales for Fourth Quarter 2001 increased two percent
 to $174 million.  The net sales increase was driven by favorable volumes
 related to Almaden, Arbor Mist and Paul Masson Grande Amber sales, partially
 offset by slightly lower average prices.  Additionally, nonbranded sales
 increased five percent versus a year ago due to greater bulk wine sales.
 Fiscal 2001 and Fiscal 2000 net sales were $688 million and $712 million,
 respectively, representing a three percent decrease.  Volume increases in
 Almaden, Arbor Mist and Paul Masson Grande Amber sales were more than offset
 by slightly lower average selling prices and lower champagne sales during
 Fiscal 2001 compared to the prior year, which included the impact of
 Millennium volume.
     Operating income increased 34 percent for Fourth Quarter 2001 to
 $16 million due to favorable marketing and promotion costs.  Excluding the
 pretax nonrecurring charge of $3 million reported for Fiscal 2000, operating
 income was $51 million for Fiscal 2001 compared to $49 million the prior year,
 an increase of three percent, also due to lower marketing and promotions.
 
     Matthew Clark Results
     Net sales for Fourth Quarter 2001 decreased slightly to $172 million from
 $175 million reported for Fourth Quarter 2000.  On a currency-adjusted basis,
 net sales improved eight percent compared to net sales reported for Fourth
 Quarter 2000.  Branded sales increased five percent, primarily attributable to
 increases in Stowells of Chelsea and California wines.  Further, wholesale
 sales improved ten percent, with the addition of Forth Wines contributing to
 more than half of the increase.  Net sales for Fiscal 2001 decreased five
 percent to $691 million from $730 million reported for Fiscal 2000.  Adjusting
 for the impact of foreign currency, net sales for Fiscal 2001 were three
 percent higher.  Increases in branded table wine, packaged cider and the U.K.
 wholesale business were partially offset by declines in draft cider sales and
 private label sales.
     Operating income for Fourth Quarter 2001 declined to $8 million from
 $14 million reported for Fourth Quarter 2000 due to increased investments in
 brand building initiatives to gain market share.  Fiscal 2001 operating income
 was up slightly to $49 million.  Excluding the pretax nonrecurring charge of
 $3 million reported for Fiscal 2000, operating income was $49 million for
 Fiscal 2001 compared to $51 million for the prior year.  On a
 currency-adjusted basis, operating income increased four percent for the year.
 
     Franciscan Results
     Franciscan's net sales for Fourth Quarter 2001 increased 26 percent to
 reach $22 million versus $18 million reported for Fourth Quarter 2000.  The
 increase is due to a combination of volume growth and selling price increases,
 particularly for Franciscan Oakville Estate, Simi and Estancia.  As a result
 of the volume growth and selling price increases, operating income grew to
 $6 million, a 13 percent increase.
     Net sales and operating income for Fiscal 2001 were $93 million and
 $24 million, respectively, an increase of 50 percent and 93 percent,
 respectively.  On a pro forma basis, net sales for Fiscal 2001 increased 15
 percent driven primarily by increases in pricing.
 
     Stock Split Details
     The Company's Board of Directors has approved a two-for-one stock split of
 both its Class A Common Stock and Class B Common Stock to be distributed in
 the form of a stock dividend on or about May 14, 2001, to stockholders of
 record on April 30, 2001.  Pursuant to the terms of the stock dividend, each
 holder of Class A Common Stock will receive one additional share of Class A
 stock for each share of Class A stock held, and each holder of Class B Common
 Stock will receive one additional share of Class B stock for each share of
 Class B stock held.
 
     Proposed Transaction with Ravenswood Winery
     Constellation and Ravenswood Winery, Inc. issued a press release on
 April 10, 2001, announcing that they entered into a merger agreement under
 which Constellation will acquire Ravenswood, a leading premium wine producer
 based in Sonoma, California.  Please refer to this April 10, 2001, press
 release for information regarding this merger transaction, including risk
 factors associated with this transaction.
 
     Outlook
     The following statements are management's current expectations for the
 Company's three months ending May 31, 2001 ("First Quarter 2002") and the
 twelve months ending February 28, 2002 ("Fiscal 2002").  These statements are
 made as of the date of this press release and are forward-looking and do not
 reflect the effect of the stock split.  Actual results may differ materially
 from these expectations due to a number of risks and uncertainties.
 
     *     Diluted earnings per share for First Quarter 2002 are expected to be
           within a range of $1.06 to $1.12 versus $0.96 reported for First
           Quarter 2001.
 
     *     Diluted earnings per share for Fiscal 2002 are expected to be within
           a range of $5.95 and $6.05 versus $5.21 reported for Fiscal 2001.
 
     The Fiscal 2002 estimate includes the expected impact of the proposed
 merger involving Constellation and Ravenswood Winery.
 
     The Company anticipates holding a conference call to discuss its First
 Quarter 2002 financial results and expectations for the remainder of Fiscal
 2002 on Thursday, June 28, 2001.
 
     Status of Business Outlook and Related Risk Factors Statements
     During the quarter, Constellation may reiterate the estimates set forth
 above under the heading Outlook (collectively, the "Outlook").  Prior to the
 start of the Quiet Period (described below), the public can continue to rely
 on the Outlook as still being Constellation's current expectations on the
 matters covered, unless Constellation publishes a notice stating otherwise.
     Beginning May 18, 2001, Constellation will observe a "Quiet Period" during
 which the Outlook no longer constitutes the Company's current expectations.
 During the Quiet Period, the Outlook should be considered to be historical,
 speaking as of prior to the Quiet Period only and not subject to update by the
 Company.  During the Quiet Period, Constellation's representatives will not
 comment concerning the Outlook or Constellation's financial results or
 expectations.  The Quiet Period will extend until the day when Constellation's
 next quarterly Earnings Release is published, presently scheduled for
 Thursday, June 28, 2001.
     The statements made under the heading Outlook are forward-looking
 statements. Unless otherwise noted, these forward-looking statements do not
 take into account the impact of any future acquisition, merger or any other
 business combination, divestiture or financing that may be completed after the
 date of this release.  Further, these statements are based on management's
 current expectations and are subject to a number of risks and uncertainties
 that could cause actual results to differ materially from those set forth in
 the forward-looking statements.  For a detailed list of the risk factors that
 may adversely impact these forward-looking statements, please refer to
 Attachment A set forth below in this press release; please also refer to our
 Company's Securities and Exchange Commission filings.
 
     About Constellation
     Constellation Brands, Inc., is a leader in the production and marketing of
 beverage alcohol brands in North America and the United Kingdom and is a
 leading independent drinks wholesaler in the United Kingdom. As the second
 largest supplier of wine, the second largest importer of beer and the fourth
 largest supplier of distilled spirits, Constellation Brands, Inc., is the
 largest single-source supplier of these products in the United States.  With
 its broad product portfolio, composed of brands in all major beverage alcohol
 categories, Constellation believes it is distinctly positioned to satisfy an
 array of consumer preferences.  Leading brands in Constellation's portfolio
 include: Franciscan Oakville Estate, Simi, Estancia, Almaden, Arbor Mist,
 Talus, Vendange, Alice White, Black Velvet, Fleischmann's, Schenley, Ten High,
 Stowells of Chelsea, Blackthorn, Modelo Especial, St. Pauli Girl, and the
 number one imported beer, Corona Extra.
 
                            CONFERENCE CALL DETAILS
     A conference call to discuss the quarterly results will be hosted by
 Richard Sands, CEO, and Tom Summer, CFO, on Thursday, April 12, 2001, at 10:00
 a.m. EDT.  The conference call can be accessed by dialing (800) 860-2442. A
 live listen-only web cast of the conference call is available on the Internet
 at Constellation's web site: http://www.cbrands.com under: Investor Info.
 
 If you are unable to participate in the conference call, there will be a
 replay available on Constellation's web site.
 
                    CONSOLIDATED FINANCIAL STATEMENTS FOLLOW
 
 
                  CONSTELLATION BRANDS, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                                 (in thousands)
 
                                                 February 28,   February 29,
                                                         2001           2000
     ASSETS
     CURRENT ASSETS:
      Cash and cash investments                      $145,672        $34,308
      Accounts receivable, net                        314,262        291,108
      Inventories, net                                670,018        615,700
      Prepaid expenses and other current assets        61,037         54,881
         Total current assets                      $1,190,989       $995,997
     PROPERTY, PLANT AND EQUIPMENT, net               548,614        542,971
     OTHER ASSETS                                     772,566        809,823
         Total assets                              $2,512,169     $2,348,791
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
     CURRENT LIABILITIES:
      Notes payable                                    $4,184        $28,134
      Current maturities of long-term debt             54,176         52,653
      Accounts payable                                114,793        122,213
      Accrued excise taxes                             55,954         30,446
      Other accrued expenses and liabilities          198,053        204,771
         Total current liabilities                   $427,160       $438,217
     LONG-TERM DEBT, less current maturities        1,307,437      1,237,135
     DEFERRED INCOME TAXES                            131,974        116,447
     OTHER LIABILITIES                                 29,330         36,152
     STOCKHOLDERS' EQUITY                             616,268        520,840
         Total liabilities and stockholders'
           equity                                  $2,512,169     $2,348,791
 
 
                  CONSTELLATION BRANDS, INC. AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                     (in thousands, except per share data)
 
                                Three Months    Three Months
                                       Ended           Ended       Percent
                                February 28,    February 29,        Change
                                        2001            2000
 
     Gross sales                    $717,657        $704,790          1.8%
     Net sales                      $544,038        $535,751          1.5%
     Cost of product sold          (379,148)       (368,228)          3.0%
        Gross profit                 164,890         167,523         -1.6%
     Selling, general and
      administrative expenses      (107,428)       (113,779)         -5.6%
        Operating income              57,462          53,744          6.9%
     Interest expense, net          (26,834)        (27,863)         -3.7%
        Income before income taxes    30,628          25,881         18.3%
     Provision for income taxes     (12,251)        (10,353)         18.3%
        Net income                   $18,377         $15,528         18.3%
 
     Earnings per common share:
      Basic                            $0.99           $0.86         15.1%
      Diluted                          $0.97           $0.84         15.5%
     Weighted average common shares outstanding:
      Basic                           18,527          18,148          2.1%
      Diluted                         19,020          18,566          2.4%
 
     Segment Information:
     Net sales:
      Barton
       Beer                         $120,786        $112,419          7.4%
       Spirits                        61,540          60,065          2.5%
        Net sales                   $182,326        $172,484          5.7%
      Canandaigua Wine
       Branded                      $154,449        $151,959          1.6%
       Other                          19,960          19,047          4.8%
        Net sales                   $174,409        $171,006          2.0%
      Matthew Clark
       Branded                       $61,572         $64,691         -4.8%
       Wholesale                     110,251         109,842          0.4%
        Net sales                   $171,823        $174,533         -1.6%
      Franciscan                     $22,015         $17,509         25.7%
      Corporate Operations and Other    $634          $1,250        -49.3%
      Intersegment eliminations     $(7,169)        $(1,031)        595.3%
      Consolidated net sales        $544,038        $535,751          1.5%
 
     Operating income:
      Barton                         $31,862         $28,092         13.4%
      Canandaigua Wine                15,940          11,909         33.8%
      Matthew Clark                    7,934          13,970        -43.2%
      Franciscan                       5,836           5,146         13.4%
      Corporate Operations and Other (4,110)         (5,373)        -23.5%
     Consolidated operating income   $57,462         $53,744          6.9%
 
                  CONSTELLATION BRANDS, INC. AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                     (in thousands, except per share data)
 
                                      Twelve          Twelve
                                Months Ended    Months Ended       Percent
                                February 28,    February 29,        Change
                                        2001            2000
 
     Gross sales                  $3,154,294      $3,088,699          2.1%
     Net sales                    $2,396,685      $2,340,469          2.4%
     Cost of product sold        (1,639,230)     (1,618,009)          1.3%
        Gross profit                 757,455         722,460          4.8%
     Selling, general and
      administrative expenses      (486,587)       (481,909)          1.0%
     Nonrecurring charges                 --         (5,510)           N/A
        Operating income             270,868         235,041         15.2%
     Interest expense, net         (108,631)       (106,082)          2.4%
        Income before income taxes   162,237         128,959         25.8%
     Provision for income taxes     (64,895)        (51,584)         25.8%
        Net income                   $97,342         $77,375         25.8%
 
     Earnings per common share:
      Basic                            $5.30           $4.29         23.5%
      Diluted                          $5.21           $4.18         24.6%
     Weighted average common
      shares outstanding:
      Basic                           18,362          18,054          1.7%
      Diluted                         18,688          18,499          1.0%
 
     Segment Information:
     Net sales:
      Barton
       Beer                         $659,371        $570,380         15.6%
       Spirits                       285,743         267,762          6.7%
        Net sales                   $945,114        $838,142         12.8%
      Canandaigua Wine
       Branded                      $610,399        $629,320         -3.0%
       Other                          78,042          82,588         -5.5%
        Net sales                   $688,441        $711,908         -3.3%
      Matthew Clark
       Branded                      $286,910        $313,102         -8.4%
       Wholesale                     404,209         416,644         -3.0%
        Net sales                   $691,119        $729,746         -5.3%
      Franciscan                     $93,115         $62,119         49.9%
      Corporate Operations and Other  $3,319          $5,372        -38.2%
      Intersegment eliminations    $(24,423)        $(6,818)        258.2%
      Consolidated net sales      $2,396,685      $2,340,469          2.4%
 
     Operating income:
      Barton                        $167,680        $142,931         17.3%
      Canandaigua Wine                50,789          46,778          8.6%
      Matthew Clark                   48,961          48,473          1.0%
      Franciscan                      24,495          12,708         92.8%
      Corporate Operations and
      Other                         (21,057)        (15,849)         32.9%
     Consolidated operating income  $270,868        $235,041         15.2%
 
 
                                  Attachment A
 
     SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
 OF 1995
 
     The Company makes forward-looking statements from time to time and desires
 to take advantage of the "safe harbor" which is afforded such statements under
 the Private Securities Litigation Reform Act of 1995 when they are accompanied
 by meaningful cautionary statements identifying important factors that could
 cause actual results to differ materially from those in the forward-looking
 statements.
     The statements set forth in this press release, which are not historical
 facts, are forward-looking statements that involve risks and uncertainties
 that could cause actual results to differ materially from those set forth in
 the forward-looking statements.  Any projections of future results of
 operations, and in particular, (i) the Company's estimated diluted earnings
 per share for the quarter ending May 31, 2001, and (ii) the Company's
 estimated diluted earnings per share for the twelve months ending February 28,
 2002, (which estimates are set forth above under the heading "Outlook"),
 should not be construed in any manner as a guarantee that such results will in
 fact occur.  There can be no assurance that any forward-looking statement in
 this press release will be realized or that actual results will not be
 significantly higher or lower than set forth in or implied by such forward-
 looking statement.  In addition to the risks and uncertainties of ordinary
 business operations, the forward-looking statements of the Company contained
 in this press release are also subject to the following risks and
 uncertainties:
 
     Recent Acquisitions and Proposed Merger with Ravenswood Winery
     Projections of future results of operations include Constellation's
 expectations with respect to future performance of recently acquired
 businesses and the expected impact of the proposed merger with Ravenswood.
 These expectations are based upon acquired businesses achieving certain sales
 projections, meeting certain cost targets and being successfully integrated
 with Constellation's operations.
 
     Performance of Wholesale Distributors
     In the United States, we sell our products principally to wholesalers for
 resale to retail outlets, including grocery stores, package liquor stores,
 club and discount stores and restaurants.  The replacement or poor performance
 of our major wholesalers or our inability to collect accounts receivable from
 our major wholesalers could materially and adversely affect our results of
 operations and financial condition.  Distribution channels for beverage
 alcohol products have been characterized in recent years by rapid change,
 including consolidations of certain wholesalers.  In addition, wholesalers and
 retailers of our products offer products, which compete directly with our
 products for retail shelf space and consumer purchases.  Accordingly, there is
 a risk that these wholesalers or retailers may give higher priority to
 products of our competitors.  In the future, our wholesalers and retailers may
 not continue to purchase our products or provide our products with adequate
 levels of promotional support.
 
     Suppliers, Raw Materials and Price Fluctuations
     Our business is heavily dependent upon raw materials, such as grapes,
 grape juice concentrate, grains, and alcohol from third-party suppliers and
 packaging materials.  We could experience raw material supply, production or
 shipment difficulties, which could adversely affect our ability to supply
 goods to our customers.  We are also directly affected by increases in the
 costs of such raw materials.  Although we believe we have adequate sources of
 grape supplies, in the event demand for certain wine products exceeds
 expectations, we could experience shortages.  In addition, one of our largest
 components of cost of goods sold is that of glass bottles, which have only a
 small number of producers.  The inability of any of our glass bottle suppliers
 to satisfy our requirements could adversely affect our business.
 
     Competition
     We are in a highly competitive industry and the dollar amount, and unit
 volume, of our sales could be negatively affected by our inability to maintain
 or increase prices, changes in geographic or product mix, a general decline in
 beverage alcohol consumption or the decision of our wholesale customers,
 retailers or consumers to purchase competitive products instead of our
 products.  Wholesaler, retailer and consumer purchasing decisions are
 influenced by, among other things, the perceived absolute or relative overall
 value of our products, including their quality or pricing, compared to
 competitive products.  Unit volume and dollar sales could also be affected by
 pricing, purchasing, financing, operational, advertising or promotional
 decisions made by wholesalers and retailers which could affect their supply
 of, or consumer demand for, our products.  We could also experience higher
 than expected selling, general and administrative expenses if we find it
 necessary to increase the number of our personnel or our advertising or
 promotional expenditures to maintain our competitive position or for other
 reasons.
 
     Consumption of Products We Sell
     Consumer purchasing patterns and preferences may impact the consumption of
 the products we sell.  There are a variety of factors that may cause consumers
 to decrease the amount and type of alcohol products purchased, including but
 not limited to the following:
     *     concerns about the health consequences of consuming beverage alcohol
           products and about drinking and driving;
     *     a trend toward a healthier diet including lighter, lower calorie
           beverages such as diet soft drinks, juices and sparkling water
           products; and
     *     activities of anti-alcohol consumer groups.
 
     Excise Taxes and Government Restrictions
     *     In the United States, the federal government and individual states
           impose excise taxes on beverage alcohol products in varying amounts,
           which have been subject to change.  Increases in excise taxes on
           beverage alcohol products, if enacted, could materially and
           adversely affect our financial condition or results of operations.
           In addition, the beverage alcohol products industry is subject to
           extensive regulation by state and federal agencies.  The federal
           Bureau of Alcohol, Tobacco and Firearms and various state liquor
           authorities regulate such matters as licensing requirements, trade
           and pricing practices, permitted and required labeling, advertising
           and relations with wholesalers and retailers.  In recent years,
           federal and state regulators have required warning labels and
           signage.  In the United Kingdom, Matthew Clark carries on its excise
           trade under a Customs and Excise License.  Licenses are required for
           all premises where wine is produced.  Matthew Clark holds a license
           to act as an excise warehouse operator and registrations have been
           secured for the production of cider and bottled water.  New or
           revised regulations or increased licensing fees and requirements
           could have a material adverse effect on our financial condition or
           results of operations.
 
     Currency Rate Fluctuations/Foreign Operations
     The Company has operations in different countries and, therefore, is
 subject to the risks associated with currency fluctuations.  The Company could
 experience changes in its ability to obtain or hedge against foreign currency,
 foreign exchange rates and fluctuations in those rates.  The Company could
 also be affected by nationalizations or unstable governments or legal systems
 or intergovernmental disputes.  These currency, economic and political
 uncertainties may affect the Company's results, especially to the extent these
 matters, or the decisions, policies or economic strength of the Company's
 suppliers, affect the Company's foreign operations or imported beer products.
 
 

SOURCE Constellation Brands, Inc.
    FAIRPORT, N.Y., April 12 /PRNewswire/ -- Constellation Brands, Inc.
 (NYSE:   STZ and STZ.B), reported net income of $18 million for the three months
 ended February 28, 2001 ("Fourth Quarter 2001"), representing an 18 percent
 increase over net income reported for the three months ended February 29, 2000
 ("Fourth Quarter 2000").  Net income of $97 million for the twelve months
 ended February 28, 2001 ("Fiscal 2001") increased 26 percent over net income
 reported for the twelve months ended February 29, 2000 ("Fiscal 2000").
     (Logo:  http://www.newscom.com/cgi-bin/prnh/20000918/NYM167LOGO )
     Earnings per share on a diluted basis for Fourth Quarter 2001 and Fiscal
 2001 were $0.97 and $5.21, respectively, representing increases of 16 percent
 and 25 percent, respectively, when compared to Fourth Quarter 2000 and Fiscal
 2000 earnings per share.  For comparative purposes, net income for Fiscal 2000
 included pretax nonrecurring charges of $6 million, or the equivalent of $0.18
 per share on a diluted basis.
     The Company also announced that its Board of Directors has approved a
 two-for-one stock split of both its Class A Common Stock and Class B Common
 Stock to be distributed in the form of a stock dividend.  Stockholders of
 record on April 30, 2001, will receive an additional share of stock for each
 share held with distribution of the additional shares expected to occur on
 May 14, 2001.  The financial statements included in this press release do not
 reflect the effect of the stock split.
     Richard Sands, Chairman, Chief Executive Officer and President of
 Constellation said, "Once again, we demonstrated our commitment to
 stockholders by delivering double-digit earnings growth for the twelfth
 consecutive quarter. This performance was achieved with top-line growth in
 every part of our business, particularly fine wine and imported beer.  In
 addition, this year we expanded the higher-margin, faster growing categories
 of our premium wine business through the acquisitions of the Turner Road
 Vintners and Corus brands.  With the addition of these brands and Ravenswood,
 coupled with our existing portfolio of leading brands, Constellation is
 positioned to deliver another year of strong double-digit earnings per share
 growth."
     Sands added, "After such a successful year and a positive outlook, we are
 pleased to announce a two-for-one stock split.  This action underscores our
 confidence in the Company's ability to deliver strong performance, as well as
 our desire to enable greater investor participation in our Company.  By
 combining top line growth with margin improvements and deleveraging
 initiatives, Constellation is well-positioned to build on its track record of
 growing earnings and increasing stockholder value."
 
     Consolidated Results
     Net sales reached $544 million for Fourth Quarter 2001, a two percent
 increase over Fourth Quarter 2000.  After adjusting for foreign currency
 impact, net sales for Fourth Quarter were five percent greater than Fourth
 Quarter 2000.  Sales increased across all businesses for Fourth Quarter 2001,
 on a currency-adjusted basis, led by fine wine, imported beer and the U.K.
 wholesale business.  Net sales for Fiscal 2001 were $2.4 billion versus
 $2.3 billion for Fiscal 2000, an increase of two percent.  On a
 currency-adjusted basis, net sales increased five percent versus Fiscal 2000
 net sales driven by fine wine, imported beer and the U.K. wholesale business.
     Gross profit for Fourth Quarter 2001 was $165 million compared to
 $168 million in the prior period.  On a currency-adjusted basis, gross profit
 increased slightly for Fourth Quarter 2001 compared to the prior period as
 increased sales more than offset a decline in gross margin.  The decline in
 gross margin was due primarily to higher energy costs impacting spirits and
 higher tequila costs.  Reported gross profit and gross margin for Fiscal 2001
 increased to $757 million and 31.6 percent, respectively, compared to
 $722 million and 30.9 percent, respectively, for Fiscal 2000.  The margin
 improvements were driven primarily by price increases in the fine wine
 business as well as cost improvements in the Company's U.K. business, Matthew
 Clark.
     Fourth Quarter 2001 selling, general and administrative expenses as a
 percent of net sales were favorable by 150 basis points versus the comparable
 quarter a year ago, declining from 21.2 percent to 19.7 percent.  Selling,
 general and administrative expenses were $107 million for Fourth Quarter 2001
 compared to $114 million reported for the same period last year.  The decrease
 is primarily attributable to lower marketing costs and corporate expenses.
 For Fiscal 2001, selling, general and administrative expenses as a percent of
 net sales decreased to 20.3 percent compared to 20.6 percent for the prior
 year.  Selling, general and administrative expenses were $487 million, an
 increase of one percent from Fiscal 2000.
     Operating income for Fourth Quarter 2001 increased to $57 million from
 $54 million, an increase of seven percent versus the same period a year ago.
 Fiscal 2001 operating income of $271 million was $30 million, or 13 percent,
 higher than Fiscal 2000, excluding pretax nonrecurring charges.
     Net interest expense for Fourth Quarter 2001 decreased four percent to
 $27 million versus $28 million reported for the same period a year ago.  The
 lower interest expense was the result of lower average debt levels for Fourth
 Quarter 2001.  For Fiscal 2001, net interest expense increased two percent to
 $109 million versus $106 million reported for Fiscal 2000.  The increase in
 net interest expense can be primarily attributed to higher average interest
 rates.
     Net income and diluted earnings per share for Fourth Quarter 2001 were
 $18 million and $0.97, respectively, as compared to net income and diluted
 earnings per share of $16 million and $0.84, respectively, reported for Fourth
 Quarter 2000.  Fiscal 2001 net income grew 26 percent to reach $97 million
 versus net income reported for Fiscal 2000 of  $77 million.  Diluted earnings
 per share for Fiscal 2001 and Fiscal 2000 were $5.21 and $4.18, respectively,
 representing an increase of 25 percent.
 
     Barton Results
     Barton net sales for Fourth Quarter 2001 were $182 million, an increase of
 six percent versus the comparable quarter a year ago.  The increase can be
 attributed primarily to volume growth in imported beer and spirits offset by
 slightly lower contract manufacturing sales.  For Fiscal 2001, net sales grew
 13 percent to $945 million driven by the following: volume growth and price
 increases in the Mexican beer portfolio, volume growth in the spirits
 portfolio, price increases on tequila products and the inclusion of brands
 acquired in the Black Velvet acquisition for a full year.  On a pro forma
 basis, net sales for Fiscal 2001 increased 12 percent.
     Operating income grew to $32 million for Fourth Quarter 2001, an increase
 of 13 percent versus the comparable quarter last year.  Sales gains in
 imported beer and lower marketing spend on spirits, more than offset increased
 energy and tequila costs associated with spirits.  Fiscal 2001 and Fiscal 2000
 operating income was $168 million and $143 million, respectively, an increase
 of 17 percent.  Volume growth and average selling price increases in imported
 beer and volume growth in spirits accounted for the growth, partially offset
 by increased selling and marketing expenses related to growth of imported
 beer.
 
     Canandaigua Wine Results
     Canandaigua Wine net sales for Fourth Quarter 2001 increased two percent
 to $174 million.  The net sales increase was driven by favorable volumes
 related to Almaden, Arbor Mist and Paul Masson Grande Amber sales, partially
 offset by slightly lower average prices.  Additionally, nonbranded sales
 increased five percent versus a year ago due to greater bulk wine sales.
 Fiscal 2001 and Fiscal 2000 net sales were $688 million and $712 million,
 respectively, representing a three percent decrease.  Volume increases in
 Almaden, Arbor Mist and Paul Masson Grande Amber sales were more than offset
 by slightly lower average selling prices and lower champagne sales during
 Fiscal 2001 compared to the prior year, which included the impact of
 Millennium volume.
     Operating income increased 34 percent for Fourth Quarter 2001 to
 $16 million due to favorable marketing and promotion costs.  Excluding the
 pretax nonrecurring charge of $3 million reported for Fiscal 2000, operating
 income was $51 million for Fiscal 2001 compared to $49 million the prior year,
 an increase of three percent, also due to lower marketing and promotions.
 
     Matthew Clark Results
     Net sales for Fourth Quarter 2001 decreased slightly to $172 million from
 $175 million reported for Fourth Quarter 2000.  On a currency-adjusted basis,
 net sales improved eight percent compared to net sales reported for Fourth
 Quarter 2000.  Branded sales increased five percent, primarily attributable to
 increases in Stowells of Chelsea and California wines.  Further, wholesale
 sales improved ten percent, with the addition of Forth Wines contributing to
 more than half of the increase.  Net sales for Fiscal 2001 decreased five
 percent to $691 million from $730 million reported for Fiscal 2000.  Adjusting
 for the impact of foreign currency, net sales for Fiscal 2001 were three
 percent higher.  Increases in branded table wine, packaged cider and the U.K.
 wholesale business were partially offset by declines in draft cider sales and
 private label sales.
     Operating income for Fourth Quarter 2001 declined to $8 million from
 $14 million reported for Fourth Quarter 2000 due to increased investments in
 brand building initiatives to gain market share.  Fiscal 2001 operating income
 was up slightly to $49 million.  Excluding the pretax nonrecurring charge of
 $3 million reported for Fiscal 2000, operating income was $49 million for
 Fiscal 2001 compared to $51 million for the prior year.  On a
 currency-adjusted basis, operating income increased four percent for the year.
 
     Franciscan Results
     Franciscan's net sales for Fourth Quarter 2001 increased 26 percent to
 reach $22 million versus $18 million reported for Fourth Quarter 2000.  The
 increase is due to a combination of volume growth and selling price increases,
 particularly for Franciscan Oakville Estate, Simi and Estancia.  As a result
 of the volume growth and selling price increases, operating income grew to
 $6 million, a 13 percent increase.
     Net sales and operating income for Fiscal 2001 were $93 million and
 $24 million, respectively, an increase of 50 percent and 93 percent,
 respectively.  On a pro forma basis, net sales for Fiscal 2001 increased 15
 percent driven primarily by increases in pricing.
 
     Stock Split Details
     The Company's Board of Directors has approved a two-for-one stock split of
 both its Class A Common Stock and Class B Common Stock to be distributed in
 the form of a stock dividend on or about May 14, 2001, to stockholders of
 record on April 30, 2001.  Pursuant to the terms of the stock dividend, each
 holder of Class A Common Stock will receive one additional share of Class A
 stock for each share of Class A stock held, and each holder of Class B Common
 Stock will receive one additional share of Class B stock for each share of
 Class B stock held.
 
     Proposed Transaction with Ravenswood Winery
     Constellation and Ravenswood Winery, Inc. issued a press release on
 April 10, 2001, announcing that they entered into a merger agreement under
 which Constellation will acquire Ravenswood, a leading premium wine producer
 based in Sonoma, California.  Please refer to this April 10, 2001, press
 release for information regarding this merger transaction, including risk
 factors associated with this transaction.
 
     Outlook
     The following statements are management's current expectations for the
 Company's three months ending May 31, 2001 ("First Quarter 2002") and the
 twelve months ending February 28, 2002 ("Fiscal 2002").  These statements are
 made as of the date of this press release and are forward-looking and do not
 reflect the effect of the stock split.  Actual results may differ materially
 from these expectations due to a number of risks and uncertainties.
 
     *     Diluted earnings per share for First Quarter 2002 are expected to be
           within a range of $1.06 to $1.12 versus $0.96 reported for First
           Quarter 2001.
 
     *     Diluted earnings per share for Fiscal 2002 are expected to be within
           a range of $5.95 and $6.05 versus $5.21 reported for Fiscal 2001.
 
     The Fiscal 2002 estimate includes the expected impact of the proposed
 merger involving Constellation and Ravenswood Winery.
 
     The Company anticipates holding a conference call to discuss its First
 Quarter 2002 financial results and expectations for the remainder of Fiscal
 2002 on Thursday, June 28, 2001.
 
     Status of Business Outlook and Related Risk Factors Statements
     During the quarter, Constellation may reiterate the estimates set forth
 above under the heading Outlook (collectively, the "Outlook").  Prior to the
 start of the Quiet Period (described below), the public can continue to rely
 on the Outlook as still being Constellation's current expectations on the
 matters covered, unless Constellation publishes a notice stating otherwise.
     Beginning May 18, 2001, Constellation will observe a "Quiet Period" during
 which the Outlook no longer constitutes the Company's current expectations.
 During the Quiet Period, the Outlook should be considered to be historical,
 speaking as of prior to the Quiet Period only and not subject to update by the
 Company.  During the Quiet Period, Constellation's representatives will not
 comment concerning the Outlook or Constellation's financial results or
 expectations.  The Quiet Period will extend until the day when Constellation's
 next quarterly Earnings Release is published, presently scheduled for
 Thursday, June 28, 2001.
     The statements made under the heading Outlook are forward-looking
 statements. Unless otherwise noted, these forward-looking statements do not
 take into account the impact of any future acquisition, merger or any other
 business combination, divestiture or financing that may be completed after the
 date of this release.  Further, these statements are based on management's
 current expectations and are subject to a number of risks and uncertainties
 that could cause actual results to differ materially from those set forth in
 the forward-looking statements.  For a detailed list of the risk factors that
 may adversely impact these forward-looking statements, please refer to
 Attachment A set forth below in this press release; please also refer to our
 Company's Securities and Exchange Commission filings.
 
     About Constellation
     Constellation Brands, Inc., is a leader in the production and marketing of
 beverage alcohol brands in North America and the United Kingdom and is a
 leading independent drinks wholesaler in the United Kingdom. As the second
 largest supplier of wine, the second largest importer of beer and the fourth
 largest supplier of distilled spirits, Constellation Brands, Inc., is the
 largest single-source supplier of these products in the United States.  With
 its broad product portfolio, composed of brands in all major beverage alcohol
 categories, Constellation believes it is distinctly positioned to satisfy an
 array of consumer preferences.  Leading brands in Constellation's portfolio
 include: Franciscan Oakville Estate, Simi, Estancia, Almaden, Arbor Mist,
 Talus, Vendange, Alice White, Black Velvet, Fleischmann's, Schenley, Ten High,
 Stowells of Chelsea, Blackthorn, Modelo Especial, St. Pauli Girl, and the
 number one imported beer, Corona Extra.
 
                            CONFERENCE CALL DETAILS
     A conference call to discuss the quarterly results will be hosted by
 Richard Sands, CEO, and Tom Summer, CFO, on Thursday, April 12, 2001, at 10:00
 a.m. EDT.  The conference call can be accessed by dialing (800) 860-2442. A
 live listen-only web cast of the conference call is available on the Internet
 at Constellation's web site: http://www.cbrands.com under: Investor Info.
 
 If you are unable to participate in the conference call, there will be a
 replay available on Constellation's web site.
 
                    CONSOLIDATED FINANCIAL STATEMENTS FOLLOW
 
 
                  CONSTELLATION BRANDS, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                                 (in thousands)
 
                                                 February 28,   February 29,
                                                         2001           2000
     ASSETS
     CURRENT ASSETS:
      Cash and cash investments                      $145,672        $34,308
      Accounts receivable, net                        314,262        291,108
      Inventories, net                                670,018        615,700
      Prepaid expenses and other current assets        61,037         54,881
         Total current assets                      $1,190,989       $995,997
     PROPERTY, PLANT AND EQUIPMENT, net               548,614        542,971
     OTHER ASSETS                                     772,566        809,823
         Total assets                              $2,512,169     $2,348,791
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
     CURRENT LIABILITIES:
      Notes payable                                    $4,184        $28,134
      Current maturities of long-term debt             54,176         52,653
      Accounts payable                                114,793        122,213
      Accrued excise taxes                             55,954         30,446
      Other accrued expenses and liabilities          198,053        204,771
         Total current liabilities                   $427,160       $438,217
     LONG-TERM DEBT, less current maturities        1,307,437      1,237,135
     DEFERRED INCOME TAXES                            131,974        116,447
     OTHER LIABILITIES                                 29,330         36,152
     STOCKHOLDERS' EQUITY                             616,268        520,840
         Total liabilities and stockholders'
           equity                                  $2,512,169     $2,348,791
 
 
                  CONSTELLATION BRANDS, INC. AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                     (in thousands, except per share data)
 
                                Three Months    Three Months
                                       Ended           Ended       Percent
                                February 28,    February 29,        Change
                                        2001            2000
 
     Gross sales                    $717,657        $704,790          1.8%
     Net sales                      $544,038        $535,751          1.5%
     Cost of product sold          (379,148)       (368,228)          3.0%
        Gross profit                 164,890         167,523         -1.6%
     Selling, general and
      administrative expenses      (107,428)       (113,779)         -5.6%
        Operating income              57,462          53,744          6.9%
     Interest expense, net          (26,834)        (27,863)         -3.7%
        Income before income taxes    30,628          25,881         18.3%
     Provision for income taxes     (12,251)        (10,353)         18.3%
        Net income                   $18,377         $15,528         18.3%
 
     Earnings per common share:
      Basic                            $0.99           $0.86         15.1%
      Diluted                          $0.97           $0.84         15.5%
     Weighted average common shares outstanding:
      Basic                           18,527          18,148          2.1%
      Diluted                         19,020          18,566          2.4%
 
     Segment Information:
     Net sales:
      Barton
       Beer                         $120,786        $112,419          7.4%
       Spirits                        61,540          60,065          2.5%
        Net sales                   $182,326        $172,484          5.7%
      Canandaigua Wine
       Branded                      $154,449        $151,959          1.6%
       Other                          19,960          19,047          4.8%
        Net sales                   $174,409        $171,006          2.0%
      Matthew Clark
       Branded                       $61,572         $64,691         -4.8%
       Wholesale                     110,251         109,842          0.4%
        Net sales                   $171,823        $174,533         -1.6%
      Franciscan                     $22,015         $17,509         25.7%
      Corporate Operations and Other    $634          $1,250        -49.3%
      Intersegment eliminations     $(7,169)        $(1,031)        595.3%
      Consolidated net sales        $544,038        $535,751          1.5%
 
     Operating income:
      Barton                         $31,862         $28,092         13.4%
      Canandaigua Wine                15,940          11,909         33.8%
      Matthew Clark                    7,934          13,970        -43.2%
      Franciscan                       5,836           5,146         13.4%
      Corporate Operations and Other (4,110)         (5,373)        -23.5%
     Consolidated operating income   $57,462         $53,744          6.9%
 
                  CONSTELLATION BRANDS, INC. AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                     (in thousands, except per share data)
 
                                      Twelve          Twelve
                                Months Ended    Months Ended       Percent
                                February 28,    February 29,        Change
                                        2001            2000
 
     Gross sales                  $3,154,294      $3,088,699          2.1%
     Net sales                    $2,396,685      $2,340,469          2.4%
     Cost of product sold        (1,639,230)     (1,618,009)          1.3%
        Gross profit                 757,455         722,460          4.8%
     Selling, general and
      administrative expenses      (486,587)       (481,909)          1.0%
     Nonrecurring charges                 --         (5,510)           N/A
        Operating income             270,868         235,041         15.2%
     Interest expense, net         (108,631)       (106,082)          2.4%
        Income before income taxes   162,237         128,959         25.8%
     Provision for income taxes     (64,895)        (51,584)         25.8%
        Net income                   $97,342         $77,375         25.8%
 
     Earnings per common share:
      Basic                            $5.30           $4.29         23.5%
      Diluted                          $5.21           $4.18         24.6%
     Weighted average common
      shares outstanding:
      Basic                           18,362          18,054          1.7%
      Diluted                         18,688          18,499          1.0%
 
     Segment Information:
     Net sales:
      Barton
       Beer                         $659,371        $570,380         15.6%
       Spirits                       285,743         267,762          6.7%
        Net sales                   $945,114        $838,142         12.8%
      Canandaigua Wine
       Branded                      $610,399        $629,320         -3.0%
       Other                          78,042          82,588         -5.5%
        Net sales                   $688,441        $711,908         -3.3%
      Matthew Clark
       Branded                      $286,910        $313,102         -8.4%
       Wholesale                     404,209         416,644         -3.0%
        Net sales                   $691,119        $729,746         -5.3%
      Franciscan                     $93,115         $62,119         49.9%
      Corporate Operations and Other  $3,319          $5,372        -38.2%
      Intersegment eliminations    $(24,423)        $(6,818)        258.2%
      Consolidated net sales      $2,396,685      $2,340,469          2.4%
 
     Operating income:
      Barton                        $167,680        $142,931         17.3%
      Canandaigua Wine                50,789          46,778          8.6%
      Matthew Clark                   48,961          48,473          1.0%
      Franciscan                      24,495          12,708         92.8%
      Corporate Operations and
      Other                         (21,057)        (15,849)         32.9%
     Consolidated operating income  $270,868        $235,041         15.2%
 
 
                                  Attachment A
 
     SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
 OF 1995
 
     The Company makes forward-looking statements from time to time and desires
 to take advantage of the "safe harbor" which is afforded such statements under
 the Private Securities Litigation Reform Act of 1995 when they are accompanied
 by meaningful cautionary statements identifying important factors that could
 cause actual results to differ materially from those in the forward-looking
 statements.
     The statements set forth in this press release, which are not historical
 facts, are forward-looking statements that involve risks and uncertainties
 that could cause actual results to differ materially from those set forth in
 the forward-looking statements.  Any projections of future results of
 operations, and in particular, (i) the Company's estimated diluted earnings
 per share for the quarter ending May 31, 2001, and (ii) the Company's
 estimated diluted earnings per share for the twelve months ending February 28,
 2002, (which estimates are set forth above under the heading "Outlook"),
 should not be construed in any manner as a guarantee that such results will in
 fact occur.  There can be no assurance that any forward-looking statement in
 this press release will be realized or that actual results will not be
 significantly higher or lower than set forth in or implied by such forward-
 looking statement.  In addition to the risks and uncertainties of ordinary
 business operations, the forward-looking statements of the Company contained
 in this press release are also subject to the following risks and
 uncertainties:
 
     Recent Acquisitions and Proposed Merger with Ravenswood Winery
     Projections of future results of operations include Constellation's
 expectations with respect to future performance of recently acquired
 businesses and the expected impact of the proposed merger with Ravenswood.
 These expectations are based upon acquired businesses achieving certain sales
 projections, meeting certain cost targets and being successfully integrated
 with Constellation's operations.
 
     Performance of Wholesale Distributors
     In the United States, we sell our products principally to wholesalers for
 resale to retail outlets, including grocery stores, package liquor stores,
 club and discount stores and restaurants.  The replacement or poor performance
 of our major wholesalers or our inability to collect accounts receivable from
 our major wholesalers could materially and adversely affect our results of
 operations and financial condition.  Distribution channels for beverage
 alcohol products have been characterized in recent years by rapid change,
 including consolidations of certain wholesalers.  In addition, wholesalers and
 retailers of our products offer products, which compete directly with our
 products for retail shelf space and consumer purchases.  Accordingly, there is
 a risk that these wholesalers or retailers may give higher priority to
 products of our competitors.  In the future, our wholesalers and retailers may
 not continue to purchase our products or provide our products with adequate
 levels of promotional support.
 
     Suppliers, Raw Materials and Price Fluctuations
     Our business is heavily dependent upon raw materials, such as grapes,
 grape juice concentrate, grains, and alcohol from third-party suppliers and
 packaging materials.  We could experience raw material supply, production or
 shipment difficulties, which could adversely affect our ability to supply
 goods to our customers.  We are also directly affected by increases in the
 costs of such raw materials.  Although we believe we have adequate sources of
 grape supplies, in the event demand for certain wine products exceeds
 expectations, we could experience shortages.  In addition, one of our largest
 components of cost of goods sold is that of glass bottles, which have only a
 small number of producers.  The inability of any of our glass bottle suppliers
 to satisfy our requirements could adversely affect our business.
 
     Competition
     We are in a highly competitive industry and the dollar amount, and unit
 volume, of our sales could be negatively affected by our inability to maintain
 or increase prices, changes in geographic or product mix, a general decline in
 beverage alcohol consumption or the decision of our wholesale customers,
 retailers or consumers to purchase competitive products instead of our
 products.  Wholesaler, retailer and consumer purchasing decisions are
 influenced by, among other things, the perceived absolute or relative overall
 value of our products, including their quality or pricing, compared to
 competitive products.  Unit volume and dollar sales could also be affected by
 pricing, purchasing, financing, operational, advertising or promotional
 decisions made by wholesalers and retailers which could affect their supply
 of, or consumer demand for, our products.  We could also experience higher
 than expected selling, general and administrative expenses if we find it
 necessary to increase the number of our personnel or our advertising or
 promotional expenditures to maintain our competitive position or for other
 reasons.
 
     Consumption of Products We Sell
     Consumer purchasing patterns and preferences may impact the consumption of
 the products we sell.  There are a variety of factors that may cause consumers
 to decrease the amount and type of alcohol products purchased, including but
 not limited to the following:
     *     concerns about the health consequences of consuming beverage alcohol
           products and about drinking and driving;
     *     a trend toward a healthier diet including lighter, lower calorie
           beverages such as diet soft drinks, juices and sparkling water
           products; and
     *     activities of anti-alcohol consumer groups.
 
     Excise Taxes and Government Restrictions
     *     In the United States, the federal government and individual states
           impose excise taxes on beverage alcohol products in varying amounts,
           which have been subject to change.  Increases in excise taxes on
           beverage alcohol products, if enacted, could materially and
           adversely affect our financial condition or results of operations.
           In addition, the beverage alcohol products industry is subject to
           extensive regulation by state and federal agencies.  The federal
           Bureau of Alcohol, Tobacco and Firearms and various state liquor
           authorities regulate such matters as licensing requirements, trade
           and pricing practices, permitted and required labeling, advertising
           and relations with wholesalers and retailers.  In recent years,
           federal and state regulators have required warning labels and
           signage.  In the United Kingdom, Matthew Clark carries on its excise
           trade under a Customs and Excise License.  Licenses are required for
           all premises where wine is produced.  Matthew Clark holds a license
           to act as an excise warehouse operator and registrations have been
           secured for the production of cider and bottled water.  New or
           revised regulations or increased licensing fees and requirements
           could have a material adverse effect on our financial condition or
           results of operations.
 
     Currency Rate Fluctuations/Foreign Operations
     The Company has operations in different countries and, therefore, is
 subject to the risks associated with currency fluctuations.  The Company could
 experience changes in its ability to obtain or hedge against foreign currency,
 foreign exchange rates and fluctuations in those rates.  The Company could
 also be affected by nationalizations or unstable governments or legal systems
 or intergovernmental disputes.  These currency, economic and political
 uncertainties may affect the Company's results, especially to the extent these
 matters, or the decisions, policies or economic strength of the Company's
 suppliers, affect the Company's foreign operations or imported beer products.
 
 SOURCE  Constellation Brands, Inc.