Constellation Brands Upgrades Fiscal Year Free Cash Flow View On Hedge Gains
Tuesday December 2nd, 2008 / 23h30
DOW JONES NEWSWIRES Constellation Brands Inc. (STZ) boosted its free-cash-flow guidance and lowered its earnings view for fiscal 2009 after closing out of certain foreign currency hedges to take advantage of the strengthening U.S. dollar. "As the company continues to refine certain of its international businesses, it has been reducing its foreign-exchange exposure by adjusting the amount of corporate parent loans to its operating companies around the world," said Chief Financial Officer Bob Ryder. The wine maker, whose brands include Robert Mondavi and Ravenswood, said its earnings would be cut by 20 cents a share to a range of 63 cents to 71 cents, although its October guidance for adjusted earnings was unchanged at $1.68 to $1.76. Constellation expects to realize about $50 million in cash proceeds from the settlement of the hedge transactions, increasing its fiscal-year free cash flow guidance by $50 million to a range of $360 million to $390 million. The company's pretax income won't be affected, although it will pay taxes on the hedge gains. In October, the company swung to a fiscal second-quarter loss on a restructuring charge and said higher prices hurt U.S. wine sales volumes. Constellation's shares were at $12.36, up 1.6%, in after-hours trading. Its shares closed Tuesday trading at $12.17. -By Kathy Shwiff, Dow Jones Newswires; 201-938-5975; Kathy.Shwiff@dowjones.com Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/al?rnd=fDjuAqlm0iAcgxiQvEfs%2Bg%3D%3D. You can use this link on the day this article is published and the following day.
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