Common-Size Income Statement
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- Analysis of Profitability Ratios
- Analysis of Short-term (Operating) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Analysis of Geographic Areas
- Enterprise Value to FCFF (EV/FCFF)
- Capital Asset Pricing Model (CAPM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Net Profit Margin since 2005
- Price to Sales (P/S) since 2005
- Analysis of Debt
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Constellation Brands Inc., common-size consolidated income statement
Based on: 10-K (reporting date: 2022-02-28), 10-K (reporting date: 2021-02-28), 10-K (reporting date: 2020-02-29), 10-K (reporting date: 2019-02-28), 10-K (reporting date: 2018-02-28), 10-K (reporting date: 2017-02-28).
- Sales and Taxes
- Sales as a percentage of net sales demonstrated a gradual decline from 109.96% in 2017 to 108.03% in 2022. Correspondingly, excise taxes, which are reported as negative percentages, also trended downward from -9.96% to -8.03%. This indicates a reduction in the relative burden of excise taxes over time.
- Cost of Product Sold and Gross Profit
- The cost of product sold as a percentage of net sales decreased from -51.86% in 2017 to -46.63% in 2022, suggesting improved cost efficiency or changes in product mix favoring lower costs. Gross profit margins improved accordingly, increasing from 48.14% to 53.37%, reflecting enhanced profitability at the gross level.
- Operating Expenses and One-Time Impairments
- Selling, general, and administrative expenses fluctuated mildly but remained relatively stable around -19% to -20.5% of net sales during the period. Notably, in 2022, a substantial impairment related to brewery construction in progress was recorded at -7.55%, and impairments of assets held for sale were notable in 2020 and 2021 at -5.39% and -0.28%, respectively. These impediments impacted expense levels and operating income in those years.
- Gains and Operating Income
- Gains on sale of business were recorded in 2017 (3.58%) and smaller in subsequent years, diminishing to near negligible levels by 2022. Operating income as a percentage of net sales showed variability, with a peak of 32.73% in 2017, a low point at 25.82% in 2020 coinciding with asset impairments, a recovery to 32.4% in 2021, and a decline to 26.43% in 2022. This pattern may reflect the influence of non-recurring items and operational challenges.
- Income from Unconsolidated Investments
- There was considerable volatility in income (loss) from unconsolidated investments, with positive contributions in early years, peaking at 25.89% in 2019, followed by significant losses in 2020 (-31.98%) and 2022 (-18.54%). This volatility influenced overall profitability and contributed to fluctuations in net income.
- Interest and Debt-related Expenses
- Interest expense remained relatively stable, ranging between -4.04% and -5.14% of net sales without a clear upward or downward trend. Loss on extinguishment of debt was minimal but persistent throughout the period, with small negative values typically below -0.5%.
- Income Tax Provision
- The provision for income taxes displayed inconsistency, moving from a negative figure in 2017 (-7.56%) and near zero or positive values in some years, including a benefit of 11.59% in 2020. This irregular pattern indicates fluctuations in taxable income or tax rates influenced by operational results or one-time items.
- Net Income and Attribution
- Net income as a percentage of net sales showed a significant increase from 20.99% in 2017 to a high of 42.62% in 2019, followed by a sharp decline to near break-even at 0.26% in 2020, and fluctuating thereafter with 23.58% in 2021 and effectively zero in 2022. Net income attributable to the parent company followed a similar trajectory, underscoring the variability in profitability driven by operational and non-operational factors. Net income attributable to noncontrolling interests remained minimal but negative throughout the period.