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Article Excerpt
- Net proceeds from asset sales expected to reduce Constellation Brands borrowings
- Company updates reported diluted EPS guidance
- Comparable earnings guidance not affected
FAIRPORT, N.Y., Aug. 6 /PRNewswire-FirstCall/ -- Constellation Brands, Inc. , a leading international beverage alcohol producer and marketer, announced today that Constellation Wines Australia (formerly Hardy Wine Company) will sell certain assets and implement changes to its wine portfolio and production footprint to simplify the business and provide better focus on premium brands and operational efficiencies aimed at increasing long- term profitable growth and improved returns. These activities are the result of the completion of a strategic review of the company's Australian business.
(Logo: http://www.newscom.com/cgi-bin/prnh/20040119/STZLOGO )
The initiative announced today involves the planned sale of three of 10 production facilities, in addition to the sale of more than 20 vineyard properties; consolidation of bottling operations; portfolio streamlining and rationalization of more than 30 percent of the company's Australian stock keeping units (SKUs). The company's Australian employment will be impacted by more than 20 percent, or 350 positions, primarily associated with assets expected to be sold.
"This project is part of our ongoing efforts to enhance operating efficiencies, improve cash flow and return on invested capital (ROIC) and reduce existing borrowings," said Rob Sands, Constellation Brands president and chief executive officer. "Australia remains one of the most important and dynamic New World Wine producing markets, and our Hardys and Banrock Station brands are two of the most recognized and consumed wines in the world. Australia is the largest New World Wine exporter based on volume and value, as well as being the second largest producer, and it is the third largest consumer market for these types of wines. This assessment of our Australian business has led to the development and implementation of an action plan that we believe will allow us to better position this business for success around the world. We will continue to provide consumers with an excellent array of the...
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