Constellation Brands Makes Investments to Increase Capacity at Its California Wineries
Marketplace brand successes create additional capacity needs
San Francisco, September 26, 2013 – Constellation Brands, Inc., (NYSE: STZ and STZ.B), a leading beverage alcohol company, announced today that it is investing over $20 million in several of its California wineries and vineyard operations to expand its growing, crushing, fermenting, storing and bottling capacities. The investment is attributable to several factors, including the increased demand for the company’s brands and creating additional efficiencies with in-house and state-of-the-art technologies.
“The need for more land, fermenters, tanks and bottling lines is a direct result of the success of our brands,” said Jay Wright, president, Wine and Spirits Division, Constellation Brands. “We see a bright future for our California brands and are committed to ensuring that we can meet consumer demand as we fulfill our mission to build brands that people love.”
The demand for additional capacity is driven by the success of Constellation’s strong premium portfolio which includes Rex Goliath, Black Box, Woodbridge by Robert Mondavi, Clos du Bois and Mark West wines. All of these brands have experienced positive growth this year, according to industry sources.
“We are continuously looking to improve our operations and have done a great job over the last several years to optimize the efficiency of our many California vineyards, wineries and facilities while at the same time maintaining the award-winning quality of our wine,” said Greg Fowler, senior vice president, Operations, Constellation Brands. “Increasing capacity from grape to glass and investing in state-of-the-art technology is a wise investment that is not only good for Constellation Brands, but good for the local economies where we live and work.”
While the projects are in various stages of completion, most are expected to be completed by the end of 2013. Collectively, the projects represent a greater than $20 million investment, which is a part of the company’s planned capital expenditures for the year. In addition to hiring local contractors and labor to support construction, development, installation and maintenance for each project, Constellation will add 15-25 employees to accommodate the increased production and operations activities.
Grape Growing Expansion
Constellation Brands is purchasing and/or leasing over 750 acres of additional land to be developed in the Lodi Delta area of San Joaquin County. Vineyards of cooler-climate varietals, such as Pinot Noir, Chardonnay and some Cabernet Sauvignon will be planted to supply brands including Mark West, Woodbridge by Robert Mondavi, Robert Mondavi Private Selection and Clos du Bois.
Grape Crushing Expansion
Constellation Brands is investing in a tank expansion project at its Gonzales winery in Monterey County that will increase its Central Coast crushing capacity from 70,000 tons to 80,000 tons.
Wine Cooperage Expansion
At its Turner Road Vintners (TRV) winery in San Joaquin County, Constellation Brands is adding 7,000 tons of crushing capacity and 1.5 million gallons of storage capacity.
At its Clos du Bois winery in Sonoma County, Constellation Brands will complete installation of over one million gallons of stainless steel tanks by mid-2014.
Wine Bottling Expansion
The TRV winery has also installed a new, in-house, state-of-the-art Tetra Pak bottling line. Constellation launched Vendange Tetra 500mL in 2004 as the first company in the U.S. to package wine domestically in the convenient, secure and eco-friendly Tetra Pak carton.
Vendange continues to be the market leader for Tetra Pak cartons with 70 percent market share and has shown double-digit growth for seven consecutive years. “We continue to see strong growth in this category and installing a new Tetra Pak line puts the company in a great position to support the growth of not only Vendange, but Black Box and Rex Goliath, which are now being offered in 500mL Tetra paks,” said Fowler.
Additionally, Constellation’s Mission Bell Winery in Madera County is adding a Bag-in-Box bottling line to increase capacity by 50 percent to meet growing demand for Black Box wine.
Woodbridge Winery in San Joaquin County plans to convert one bottling line to accommodate growth of the 187mL PET bottle category for its Woodbridge by Robert Mondavi brand.
About Constellation Brands, Inc.
Constellation Brands (NYSE: STZ and STZ.B) is an S&P 500 Index and Fortune 1000® wine, beer and spirits company with more than 100 brands in its portfolio, sales in approximately 100 countries, operations in about 40 facilities and approximately 6,000 talented employees. Founded in 1945, Constellation has grown to become the world’s leader in premium wine, the number one beer importer, and the number three beer company in the U.S. with brands that people love, including: Arbor Mist, Black Box, Blackstone, Clos du Bois, Estancia, Franciscan Estate, Inniskillin, Kim Crawford, Mark West, Mount Veeder, Nobilo, Ravenswood, Rex Goliath, Robert Mondavi, Ruffino, SIMI, Toasted Head, Wild Horse, Corona Extra, Corona Light, Modelo Especial, Negra Modelo, Pacifico, Tsingtao, Victoria, Black Velvet Canadian Whisky and SVEDKA Vodka.
Based in Victor, N.Y., the company believes that industry leadership involves a commitment to its brands, to the trade, to the land, to investors and to people around the world who turn to our products when celebrating big moments or enjoying quiet ones. We express this commitment through our vision: to elevate life with every glass raised. To learn more, visit www.cbrands.com.
Source: Constellation Brands