Constellation Brands, Inc. (NYSE:STZ) stock fell 3.27% (As on October 7, 11:53:56 AM UTC-4, Source: Google Finance) though the company delivered better than expected results for the second quarter of FY 23. The beer business posted depletion growth of nearly 9% that is more than 9 million additional cases for the quarter. The Wine portfolio gained share and outperformed the entire Wine category in tracked channels, while the craft spirits brands outperformed the higher end segment of the Spirits category. Further, the beer business also continues to outperform the entire category. In the second quarter, the beer business remained the leading share gainer in U.S. tracked channels across the entire beer category and now accounts for 28% of the high end segment. In the craft spirits portfolio, High West, Casa Noble and Mi CAMPO all achieved strong double-digit depletion growth. In addition, the International and DTC channels each delivered double-digit net sales growth year-over-year and the company continues to gain share and three-tier ecommerce.  as of the end of the second quarter, the company were over 97% for meeting the $5 billion goal and have now exceeded the share buybacks component of the goal by $300 million and upon payment of today’s declared dividend, which the company expects to take place next month, the company will have fully achieved the goal ahead of the fiscal year-end deadline.

STZ in the second quarter of FY 23 has reported the adjusted earnings per share of $3.17, beating the analysts’ estimates for the adjusted earnings per share of $2.88. The company had reported the adjusted revenue growth of 12 percent to $2.66 billion in the second quarter of FY 23, beating the analysts’ estimates for revenue of $2.5 billion.

The company is confident that over the medium-term, the beer business remains well positioned to deliver 7% to 9% net sales growth and 39% to 40% operating margin, supported by the sustained momentum of the core brands, the steady progress of the brewing capacity additions and the continued development of our innovation lineup, including the momentum of the Chelada brands, the recent launch of Fresca Mixed, the expansion of Modelo Oro from select test markets to the entire national market next year and the introduction of Corona non-alcoholic. The company continues to expect fiscal 2023 free cash flow to be in the range of $1.3 billion to $1.4 billion, which reflects operating cash flow in the range of $2.6 billion to $2.8 billion and unchanged CapEx of $1.3 billion to $1.4 billion.