Filed by Constellation Brands, Inc.
Pursuant to Rule 425 under the Securities Act of
and deemed filed pursuant to Rule 14a-12
under the Securities Exchange Act of 1934
Subject Company: Constellation Brands, Inc.
Commission File No. 001-08495
The following is an excerpt of an interview that was
conducted on CNBC on June 30, 2022.
Transcript - Constellation Brands, Inc.,
President and Chief Executive Officer, on Mad Money
Jim Cramer: What in the world did Constellation Brands do
wrong here? Yeah, the beer, wine and liquor company best known for
Corona, Modelo, and Pacifico, reported a very good set of results
this morning, and its stock tumbled more than 4%. Constellation
delivered a 14 cent earnings beat, off of a $2.52 basis,
higher-than-expected costs but much higher-than-expected sales.
That’s due to the tremendous strength in their beer business. But
here’s the rub, management merely reiterated their full-year
forecast. They didn’t raise numbers. I mean, you do that if you are
beating the earnings estimates. This merciless market treats it
like a guide down. Perhaps more important, Constellation announced
its deal with the Sands family, its largest shareholder to swap
their Class B shares for regular common stock. Well, that
would simplify the ownership structure, and it also increases the
share count by 14%. Plus, these guys own a major stake in Canopy
Growth, the cannabis business, and they are buying more at a very
low price. But that caused Canopy stock to plunge more than
18 percent today. Constellation already owns a chunk of it, so
that hurts too. The question is, can we just asterisk these
negatives please, and focus on the very strong core business, or is
that just too hard in such a difficult market? Let’s take it with
Bill Newlands, the President and CEO of Constellation Brands, to
get a better read on the situation. Mr. Newlands welcome back
to Mad Money.
Bill Newlands: Thanks Jim, good to be here.
Jim Cramer: Alright, so Bill, I struggle here, because there
isn’t a food, a beer, an alcohol, consumer packaged goods company
that has your growth, and then suddenly it didn’t matter, because
you bought out a family, and because people felt that costs were up
just slightly. Can you please work us through why we should be more
focused on the sales aspect than we should on what happened with
the Sands family?
Bill Newlands: I think you should be very excited about our
depletion rate for the first quarter. As you know Jim, I’m a big
believer in delivering what you promise. And we delivered a very
strong quarter with depletions particularly in our beer business up
almost 9%. When you look at the future potential of that business,
we have a lot of areas of strength. And I think it’s important to
look at that against depletions. Ah, the depletions scenario is
continuing to look very solid in that business, and I think
investors need to be very focused on that. Admittedly, we are only
one quarter in. I think it’s always dangerous to overpromise too
early in the year when you are in an area of unprecedented
volatility, but we are very confident and we are very comfortable
with the start we had to our year.
Jim Cramer: Now, I totally agree with you, and I know your
business very, very well. There were some elevation of cost, but I
could argue that actually we are seeing some of those costs peak.
Aluminum has come down a lot, there are people who believe that
glass could be peaking. I mean it’s entirely possible that the raw
costs that have spiked here could get under control let’s say some
point in the second half. Am I too optimistic?
Bill Newlands: I don’t think you are. And in fact, we are
heavily hedged. We are hedged significantly more than we usually
are because we are trying to drive some of that volatility out of
the market. And we are seeing certain commodities improving,
aluminum being one of them. So, we do think that as the year goes
on, we are hopeful that you are going to see a little bit more of a
balancing act than sort of what we’ve been looking at for the last
several months with great volatility.