| Comparable adjustments |
Comparable Adjustments that impacted comparability in our segment operating income (loss) for each period are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended August 31, |
|
For the Three Months Ended August 31, |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
(in millions) |
|
|
|
|
|
|
|
Cost of product sold |
|
|
|
|
|
|
|
Strategic business development costs |
$ |
(62.5 |
) |
|
$ |
— |
|
|
$ |
(18.0 |
) |
|
$ |
— |
|
Settlements of undesignated commodity derivative contracts |
(48.4 |
) |
|
(5.1 |
) |
|
(18.4 |
) |
|
(3.6 |
) |
Accelerated depreciation |
(5.3 |
) |
|
(5.0 |
) |
|
(1.8 |
) |
|
(1.6 |
) |
Flow through of inventory step-up |
(1.2 |
) |
|
(1.4 |
) |
|
(0.8 |
) |
|
(0.8 |
) |
Net gain (loss) on undesignated commodity derivative contracts |
26.8 |
|
|
9.6 |
|
|
10.9 |
|
|
(5.8 |
) |
Recovery of (loss on) inventory write-down |
8.6 |
|
|
(1.5 |
) |
|
8.6 |
|
|
— |
|
Total cost of product sold |
(82.0 |
) |
|
(3.4 |
) |
|
(19.5 |
) |
|
(11.8 |
) |
|
|
|
|
|
|
|
|
Selling, general, and administrative expenses |
|
|
|
|
|
|
|
Net gain (loss) on foreign currency derivative contracts associated with acquisition of investment |
— |
|
|
(7.1 |
) |
|
— |
|
|
(7.1 |
) |
Restructuring and other strategic business development costs |
(50.1 |
) |
|
(8.6 |
) |
|
(26.5 |
) |
|
(4.3 |
) |
Transaction, integration, and other acquisition-related costs |
(5.5 |
) |
|
(1.0 |
) |
|
(3.2 |
) |
|
(1.0 |
) |
Impairment of intangible assets |
(11.0 |
) |
|
— |
|
|
(11.0 |
) |
|
— |
|
Deferred compensation |
— |
|
|
(16.3 |
) |
|
— |
|
|
— |
|
Other gains (losses) (1)
|
1.1 |
|
|
8.5 |
|
|
(12.3 |
) |
|
8.5 |
|
Total selling, general, and administrative expenses |
(65.5 |
) |
|
(24.5 |
) |
|
(53.0 |
) |
|
(3.9 |
) |
Comparable Adjustments, Operating income (loss) |
$ |
(147.5 |
) |
|
$ |
(27.9 |
) |
|
$ |
(72.5 |
) |
|
$ |
(15.7 |
) |
(1)
Includes a gain of $11.8 million for the six months ended August 31, 2019, in connection with the increase in our ownership interest in Nelson’s Green Brier and a loss of $11.4 million and $13.3 million for the six months and three months ended August 31, 2019, respectively, in connection with an increase in estimated fair value of a contingent liability associated with a prior period acquisition.
|
| Segment information |
Segment information is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended August 31, |
|
For the Three Months Ended August 31, |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
(in millions) |
|
|
|
|
|
|
|
Beer |
|
|
|
|
|
|
|
Net sales |
$ |
3,117.8 |
|
|
$ |
2,902.2 |
|
|
$ |
1,640.4 |
|
|
$ |
1,527.1 |
|
Segment operating income (loss) |
$ |
1,265.9 |
|
|
$ |
1,150.6 |
|
|
$ |
685.3 |
|
|
$ |
630.6 |
|
Capital expenditures |
$ |
272.8 |
|
|
$ |
296.3 |
|
|
$ |
170.7 |
|
|
$ |
159.8 |
|
Depreciation and amortization |
$ |
106.2 |
|
|
$ |
100.5 |
|
|
$ |
51.9 |
|
|
$ |
51.0 |
|
|
|
|
|
|
|
|
|
Wine and Spirits |
|
|
|
|
|
|
|
Net sales: |
|
|
|
|
|
|
|
Wine |
$ |
1,146.1 |
|
|
$ |
1,262.8 |
|
|
$ |
611.1 |
|
|
$ |
671.0 |
|
Spirits |
177.3 |
|
|
181.2 |
|
|
92.5 |
|
|
101.0 |
|
Net sales |
$ |
1,323.4 |
|
|
$ |
1,444.0 |
|
|
$ |
703.6 |
|
|
$ |
772.0 |
|
Segment operating income (loss) |
$ |
321.2 |
|
|
$ |
369.2 |
|
|
$ |
160.4 |
|
|
$ |
201.4 |
|
Income (loss) from unconsolidated investments |
$ |
3.0 |
|
|
$ |
3.8 |
|
|
$ |
(1.0 |
) |
|
$ |
(1.0 |
) |
Equity method investments |
$ |
76.8 |
|
|
$ |
79.1 |
|
|
$ |
76.8 |
|
|
$ |
79.1 |
|
Capital expenditures |
$ |
43.1 |
|
|
$ |
58.8 |
|
|
$ |
16.2 |
|
|
$ |
31.0 |
|
Depreciation and amortization |
$ |
50.0 |
|
|
$ |
49.2 |
|
|
$ |
25.0 |
|
|
$ |
24.8 |
|
|
|
|
|
|
|
|
|
Corporate Operations and Other |
|
|
|
|
|
|
|
Segment operating income (loss) |
$ |
(97.4 |
) |
|
$ |
(101.5 |
) |
|
$ |
(53.7 |
) |
|
$ |
(51.3 |
) |
Income (loss) from unconsolidated investments |
$ |
(1.3 |
) |
|
$ |
(1.2 |
) |
|
$ |
(0.2 |
) |
|
$ |
(1.1 |
) |
Equity method investments |
$ |
81.0 |
|
|
$ |
41.2 |
|
|
$ |
81.0 |
|
|
$ |
41.2 |
|
Capital expenditures |
$ |
39.3 |
|
|
$ |
15.5 |
|
|
$ |
12.6 |
|
|
$ |
11.6 |
|
Depreciation and amortization |
$ |
10.5 |
|
|
$ |
17.1 |
|
|
$ |
5.2 |
|
|
$ |
8.7 |
|
|
|
|
|
|
|
|
|
Canopy |
|
|
|
|
|
|
|
Net sales |
$ |
138.4 |
|
|
NA |
|
|
$ |
67.7 |
|
|
NA |
|
Segment operating income (loss) |
$ |
(330.5 |
) |
|
NA |
|
|
$ |
(160.5 |
) |
|
NA |
|
Capital expenditures |
$ |
270.6 |
|
|
NA |
|
|
$ |
158.4 |
|
|
NA |
|
Depreciation and amortization |
$ |
35.0 |
|
|
NA |
|
|
$ |
17.4 |
|
|
NA |
|
|
|
|
|
|
|
|
|
Consolidation and Eliminations |
|
|
|
|
|
|
|
Net sales |
$ |
(138.4 |
) |
|
$ |
— |
|
|
$ |
(67.7 |
) |
|
$ |
— |
|
Operating income (loss) |
$ |
330.5 |
|
|
$ |
— |
|
|
$ |
160.5 |
|
|
$ |
— |
|
Income (loss) from unconsolidated investments |
$ |
(109.1 |
) |
|
$ |
— |
|
|
$ |
(54.7 |
) |
|
$ |
— |
|
Equity method investments |
$ |
2,846.0 |
|
|
$ |
— |
|
|
$ |
2,846.0 |
|
|
$ |
— |
|
Capital expenditures |
$ |
(270.6 |
) |
|
$ |
— |
|
|
$ |
(158.4 |
) |
|
$ |
— |
|
Depreciation and amortization |
$ |
(35.0 |
) |
|
$ |
— |
|
|
$ |
(17.4 |
) |
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended August 31, |
|
For the Three Months Ended August 31, |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
(in millions) |
|
|
|
|
|
|
|
Comparable Adjustments |
|
|
|
|
|
|
|
Operating income (loss) |
$ |
(147.5 |
) |
|
$ |
(27.9 |
) |
|
$ |
(72.5 |
) |
|
$ |
(15.7 |
) |
Income (loss) from unconsolidated investments |
$ |
(2,147.9 |
) |
|
$ |
1,050.2 |
|
|
$ |
(1,268.8 |
) |
|
$ |
690.5 |
|
Depreciation and amortization |
$ |
5.3 |
|
|
$ |
5.0 |
|
|
$ |
1.8 |
|
|
$ |
1.6 |
|
|
|
|
|
|
|
|
|
Consolidated |
|
|
|
|
|
|
|
Net sales |
$ |
4,441.2 |
|
|
$ |
4,346.2 |
|
|
$ |
2,344.0 |
|
|
$ |
2,299.1 |
|
Operating income (loss) |
$ |
1,342.2 |
|
|
$ |
1,390.4 |
|
|
$ |
719.5 |
|
|
$ |
765.0 |
|
Income (loss) from unconsolidated investments (1)
|
$ |
(2,255.3 |
) |
|
$ |
1,052.8 |
|
|
$ |
(1,324.7 |
) |
|
$ |
688.4 |
|
Equity method investments |
$ |
3,003.8 |
|
|
$ |
120.3 |
|
|
$ |
3,003.8 |
|
|
$ |
120.3 |
|
Capital expenditures |
$ |
355.2 |
|
|
$ |
370.6 |
|
|
$ |
199.5 |
|
|
$ |
202.4 |
|
Depreciation and amortization |
$ |
172.0 |
|
|
$ |
171.8 |
|
|
$ |
83.9 |
|
|
$ |
86.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Income (loss) from unconsolidated investments consists of: |
|
|
|
For the Six Months Ended |
|
For the Three Months Ended |
|
|
|
August 31,
2019 |
|
August 31,
2018 |
|
August 31,
2019 |
|
August 31,
2018 |
|
|
(in millions) |
|
|
|
|
|
|
|
|
|
Unrealized net gain (loss) on securities measured at fair value |
$ |
(1,666.6 |
) |
|
$ |
950.4 |
|
|
$ |
(839.1 |
) |
|
$ |
692.1 |
|
|
|
Net gain (loss) on sale of unconsolidated investment (i)
|
(0.1 |
) |
|
99.8 |
|
|
— |
|
|
(1.6 |
) |
|
|
Equity in earnings (losses) of equity method investees and related activities (ii)
|
(588.6 |
) |
|
2.6 |
|
|
(485.6 |
) |
|
(2.1 |
) |
|
|
|
$ |
(2,255.3 |
) |
|
$ |
1,052.8 |
|
|
$ |
(1,324.7 |
) |
|
$ |
688.4 |
|
|
|
|
|
|
|
|
|
|
|
|
(i) |
In May 2018, we completed the sale of our remaining interest in our previously-owned Australian and European business (the “Accolade Wine Investment”) for A$149.1 million, or $113.6 million, subject to closing adjustments. We received cash proceeds, net of direct costs to sell, of $110.2 million and a note receivable of $3.4 million. This interest consisted of an investment accounted for under the cost method and available-for-sale debt securities. |
|
(ii) |
Includes the June 2019 Warrant Modification Loss. |
|