form8k-111307.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date
of
Report (Date of earliest event reported) November
11, 2007
CONSTELLATION
BRANDS, INC.
|
(Exact
name of registrant as specified in its
charter)
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Delaware
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001-08495
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16-0716709
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(State
or other jurisdiction
of
incorporation)
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(Commission
File
Number)
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(IRS
Employer
Identification
No.)
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370
Woodcliff
Drive, Suite 300, Fairport, NY 14450
(Address
of Principal Executive
Offices) (Zip
Code)
Registrant’s
telephone number, including area code
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(585)
218-3600
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Not
Applicable
|
(Former
name or former address, if changed since last
report)
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Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
o
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
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Item
2.05.
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Costs
Associated with Exit or Disposal
Activities.
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On
an
ongoing basis, Constellation Brands, Inc. (the “Company”) seeks to maximize
asset utilization, reduce costs and improve long-term return on invested
capital
throughout its international operations. In connection with these
efforts, on November 11, 2007, the Company committed to the principal features
of a plan to streamline certain of its global operations in Australia, primarily
by consolidating to its Berri Estates winery certain winemaking and packaging
operations currently conducted at another Australian winery (the “Hardy
Initiative”). The Hardy Initiative includes the buy-out of certain
grape processing and wine storage contracts and equipment relocation
costs. The Hardy Initiative also includes costs for employee
terminations. The actions under the Hardy Initiative are expected to commence
by
November 19, 2007, and the Company currently expects the Hardy Initiative
to be
complete by the end of the Company’s first quarter of fiscal year 2010
which ends on May 31, 2009.
As
further detailed in the table below, the Company expects to incur approximately
$15.3 million of restructuring charges in connection with the Hardy Initiative
and approximately $1.1 million of other related costs, all of which charges
and
costs will be recorded in the Company’s results of operations during the fiscal
years ending February 29, 2008 (“Fiscal 2008”), February 28, 2009 (“Fiscal
2009”) and February 28, 2010 (“Fiscal 2010”). Additionally, the
Company expects to record accelerated depreciation of approximately $5.5
million
during Fiscal 2008 and Fiscal 2009 for certain property, plant and
equipment. In connection with the Hardy Initiative, the Company
expects to incur aggregate cash expenditures of approximately $16.4 million,
primarily during Fiscal 2008 and Fiscal 2009, and an aggregate of approximately
$5.5 million of non-cash costs during Fiscal 2008 and Fiscal
2009. The following table sets forth the Company’s current
expectations related to the Hardy Initiative:
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Estimated
Pretax
Charges
During
Fiscal
2008
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Estimated
Pretax
Charges
During
Fiscal
2009
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Estimated
Pretax
Charges
During
Fiscal
2010
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Estimated
Total
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(in
millions)
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Restructuring
charges:
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Employee
termination
costs
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$ |
2.1
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$ |
1.1
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$ |
-
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$ |
3.2
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Contract
termination
costs
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8.5
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-
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-
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8.5
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Other
associated
costs
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0.1
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0.8
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2.7
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3.6
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Total
restructuring charges
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10.7
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1.9
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2.7
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15.3
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Other
related costs
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-
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1.1
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-
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1.1
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Total
cash costs
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10.7
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3.0
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2.7
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16.4
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Accelerated
depreciation (non-cash costs)
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3.5
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2.0
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-
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5.5
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Total
cash and non-cash costs
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$ |
14.2
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$ |
5.0
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$ |
2.7
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$ |
21.9
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This
Current Report on Form 8-K contains “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. These forward-looking statements are
subject to a number of risks and uncertainties, many of which are beyond
the
Company’s control, which could cause actual results to differ materially from
those set forth in, or implied by, such forward-looking
statements. All statements other than statements of historical facts
included in this Current Report on Form 8-K, including statements regarding
the
Company’s expected restructuring charges, other related costs, and accelerated
depreciation, all of which are in connection with the Hardy Initiative, are
forward-looking statements. All forward-looking statements speak only
as of the date of this Current Report on Form 8-K. The Company
undertakes no obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or
otherwise. In addition to the risks and uncertainties of ordinary
business operations and conditions in the general economy and the markets
in
which the Company competes, the forward-looking statements of the Company
contained in this Current Report on Form 8-K are also subject to the following
risks and uncertainties: the Company’s restructuring charges, other
related costs, and accelerated depreciation, all of which are in connection
with
the Hardy Initiative, may vary materially from management’s current estimates of
these charges and costs due to variations in anticipated headcount reductions,
contract terminations and equipment relocation; and other risks and
uncertainties described in the Company’s Annual Report on Form 10-K for the
fiscal year ended February 28, 2007, and other Securities and Exchange
Commission filings.
Item
7.01.
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Regulation
FD Disclosure.
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On
November 12, 2007, the Company issued a news release, a copy of which is
furnished herewith as Exhibit 99.1 and is incorporated herein by
reference. The release provided information about, among other items,
the Company’s plans to streamline certain of its global operations and the
Company’s updated financial guidance for the fiscal year ending February 29,
2008. The projections constituting the guidance included in the
release involve risks and uncertainties, the outcome of which cannot be foreseen
at this time and, therefore, actual results may vary materially from these
forecasts. In this regard, see the information included in the release under
the
caption “Forward-Looking Statements.”
References
to the Company’s website in the release do not incorporate by reference the
information on such website into this Current Report on Form 8-K and the
Company
disclaims any such incorporation by reference. The information
in the news release attached as Exhibit 99.1 is incorporated by reference
into this Item 7.01 in satisfaction of the public disclosure requirements
of
Regulation FD. This information is “furnished” and not
“filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or
otherwise subject to the liabilities of that section. It may only be
incorporated by reference in another filing under the Securities Exchange
Act of
1934 or the Securities Act of 1933 only if and to the extent such subsequent
filing specifically references the information incorporated by reference
herein.
Item
9.01.
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Financial
Statements and Exhibits.
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(a)
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Financial
statements of businesses acquired.
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Not
applicable.
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(b)
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Pro
forma financial information.
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Not
applicable.
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(c)
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Shell
company transactions.
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Not
applicable.
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(d)
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Exhibits.
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The
following exhibit is furnished as part of this Current Report on Form
8-K:
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Exhibit
No.
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Description
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99.1
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News
Release of the Company dated November 12,
2007.
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
Date: November
13, 2007
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CONSTELLATION
BRANDS, INC.
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By: |
/s/
Robert
Ryder
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Robert
Ryder |
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Executive
Vice President and
Chief
Financial Officer
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INDEX
TO EXHIBITS
(1)
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UNDERWRITING
AGREEMENT
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Not
Applicable.
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(2)
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PLAN
OF ACQUISITION, REORGANIZATION, ARRANGEMENT, LIQUIDATION OR
SUCCESSION
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Not
Applicable.
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(3)
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ARTICLES
OF INCORPORATION AND BYLAWS
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Not
Applicable.
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(4)
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INSTRUMENTS
DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING
INDENTURES
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Not
Applicable.
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(7)
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CORRESPONDENCE
FROM AN INDEPENDENT ACCOUNTANT REGARDING NON-RELIANCE ON A PREVIOUSLY
ISSUED AUDIT REPORT OR COMPLETED INTERIM REVIEW
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Not
Applicable.
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(14)
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CODE
OF ETHICS
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Not
Applicable.
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(16)
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LETTER
RE CHANGE IN CERTIFYING ACCOUNTANT
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Not
Applicable.
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(17)
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CORRESPONDENCE
ON DEPARTURE OF DIRECTOR
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Not
Applicable.
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(20)
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OTHER
DOCUMENTS OR STATEMENTS TO SECURITY HOLDERS
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Not
Applicable.
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(23)
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CONSENTS
OF EXPERTS AND COUNSEL
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Not
Applicable.
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(24)
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POWER
OF ATTORNEY
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Not
Applicable.
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(99)
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ADDITIONAL
EXHIBITS
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(99.1)
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News
Release of Constellation Brands, Inc. dated November 12,
2007.
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(100)
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XBRL-RELATED
DOCUMENTS
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Not
Applicable.
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