Constellation Brands CEO: 'We're Going To Take A Significant Share' Of Seltzer Market

Constellation Brands CEO: 'We're Going To Take A Significant Share' Of Seltzer Market

Alcohol company Constellation Brands, Inc. STZ 0.71% managed to offset lost sales from bars and restaurants amid pandemic restrictions by targeting consumers at home with "brands that people trust," CEO Bill Newlands said Thursday on CNBC's "Mad Money."

Q3 Beat

Constellation, the parent company of Corona, Modelo Especial and Svedka Vodka, among many other alcohol brands, reported Thursday a 22% increase in year-over-year revenue in the third quarter at $2.44 billion. The earnings beat comes at a time when the company is still for the most part unable to capture sales from restaurants, bars and other away-from-home channels.

Sales in the away-from-home category were down 35% in the quarter, but earnings per share still grew 44% year-over-year. The company is taking advantage of a trend in which consumers "stick with things that they know," the CEO said.

For example, sales of all Corona-branded beverages were up nearly 12% in the quarter. This includes sales of the new Corona seltzer beverage that was launched last spring.

Related Link: Constellation Brands CEO Talks New Corona Hard Seltzer, 'Pretty Good' Q1

Building On Momentum

Constellation sold 10 million cases of seltzer beverages throughout 2020, and management is looking to build on last year's momentum. The company hopes to more than double its current capacity in seltzers in 2021 and will soon launch a new lineup called "Variety Pack #2."

The current variety pack includes tropical lime, mango, cherry and blackberry lime flavors. But the CEO kept it a mystery what new flavors will be featured in the new launch.

Regardless of the flavor selection, Constellation is confident it is "going to take a significant share" of the fast-growing seltzer category, the CEO said.

Photo courtesy Constellation Brands.

© 2021 Benzinga does not provide investment advice. All rights reserved.

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