Constellation Brands (NYSE: STZ and STZ.B), a Fortune 500® company, is a leading international producer and marketer of beer, wine and spirits with operations in the U.S., Mexico, New Zealand, Italy and Canada. Constellation is the No. 3 beer company in the U.S. with high-end, iconic imported brands such as Corona Extra, Corona Light, Modelo Especial, Modelo Negra and Pacifico. The company’s beer portfolio also includes Ballast Point, one of the most awarded craft brewers in the U.S., and Funky Buddha Brewery. In addition, Constellation is the world leader in premium wine, selling great brands that people love including Robert Mondavi, Clos du Bois, Kim Crawford, Meiomi, Mark West, Black Box, Ruffino and The Prisoner. The company’s premium spirits brands include SVEDKA Vodka, Casa Noble Tequila and High West Whiskey.
International operations, worldwide and domestic economic trends and financial market conditions, geopolitical uncertainty, or changes to international trade agreements and tariffs, import and excise duties, other taxes, or other governmental rules and regulations
Dependence on limited facilities for production of our Mexican beer brands, and expansion and construction issues
Operational disruptions or catastrophic loss to breweries, wineries, other production facilities or distribution systems
Supply of quality water, agricultural and other raw materials, certain raw materials and packaging materials purchased under short-term supply contracts, limited group of suppliers of glass bottles
Reliance on wholesale distributors, major retailers and government agencies
Reliance upon complex information systems and third party global networks, cyber-attacks, and design and implementation of our new global enterprise resource planning system (“ERP”)
Contamination and degradation of product quality from diseases, pests and weather conditions
Climate change and environmental regulatory compliance
Cannabis is currently illegal under U.S. federal law and in other jurisdictions; we do not control Canopy’s business or operations
Potential decline in the consumption of products we sell; dependence on sales of our Mexican beer brands
Acquisition, divestiture, investment, and new product development strategies
Sale of a portion of our wine and spirits business
Our Canopy investments are dependent upon an emerging market and legal sales of cannabis products
Dependence upon trademarks and proprietary rights, failure to protect our intellectual property rights
Intangible assets, such as goodwill and trademarks
Changes to tax laws, fluctuations in our effective tax rate, accounting for tax positions and the resolution of tax disputes, and changes to accounting standards, elections or assertions
Securities measured at fair value
Canopy’s Corporate Governance
Class action or other litigation relating to abuse of our products, the misuse of our products, product liability, or marketing or sales practices
Management excludes items that affect comparability from its evaluation of the results of each operating segment as these Comparable Adjustments are not reflective of core operations of the segments. Segment operating performance and segment management compensation are evaluated based on core segment operating income (loss). As such, the performance measures for incentive compensation purposes for segment management do not include the impact of these Comparable Adjustments.
We recognized costs primarily in connection with losses on write-downs of excess inventory and contract terminations resulting from our ongoing efforts to optimize our portfolio, gain efficiencies, and reduce our cost structure within the Wine and Spirits segment.
Net gain (loss) on undesignated commodity derivative contracts represents a net gain (loss) from the changes in fair value of undesignated commodity derivative contracts. The net gain (loss) is reported outside of segment operating results until such time that the underlying exposure is recognized in the segment operating results. At settlement, the net gain (loss) from the changes in fair value of the