17.     BUSINESS SEGMENT INFORMATION:

          In connection with the Company’s changes on June 1, 2011, within its internal management structure for its wine and spirits business, the Company changed its internal management financial reporting to consist of two business divisions: Constellation Wines North America and Crown Imports. Accordingly, beginning June 1, 2011, the Company began reporting its operating results in three segments: Constellation Wines North America (wine and spirits) (“CWNA”), Corporate Operations and Other, and Crown Imports (imported beer). Prior to the change in its internal management structure, the Company’s internal management financial reporting consisted of three business divisions: Constellation Wines North America, Constellation Wines New Zealand and Crown Imports. Due to a number of factors, including the size of the Constellation Wines New Zealand segment’s operations, the similarity of its economic characteristics and long-term financial performance with that of the Constellation Wines North America business, and the fact that the vast majority of the wine produced by the Constellation Wines New Zealand operating segment is sold in the U.S. and Canada, the Company had aggregated the results of this operating segment with its Constellation Wines North America operating segment to form one reportable segment. Accordingly, the June 1, 2011, organizational changes had no impact on the Company’s previously reported financial information. The business segments reflect how the Company’s operations are managed, how operating performance within the Company is evaluated by senior management and the structure of its internal financial reporting. Amounts included in the Corporate Operations and Other segment consist of costs of executive management, corporate development, corporate finance, human resources, internal audit, investor relations, legal, public relations and global information technology. Any costs incurred at the corporate office that are applicable to the segments are allocated to the appropriate segment. The amounts included in the Corporate Operations and Other segment are general costs that are applicable to the consolidated group and are therefore not allocated to the other reportable segments. All costs reported within the Corporate Operations and Other segment are not included in the chief operating decision maker’s evaluation of the operating income performance of the other reportable segments.

          In addition, the Company excludes restructuring charges and unusual items that affect comparability from its definition of operating income for segment purposes as these items are not reflective of normal continuing operations of the segments. The Company excludes these items as segment operating performance and segment management compensation is evaluated based upon a normalized segment operating income. As such, the performance measures for incentive compensation purposes for segment management do not include the impact of these items.

          For the three months ended May 31, 2011, and May 31, 2010, restructuring charges and unusual items included in operating income consist of:

		For the Three Months
		Ended May 31,
		2011				2010
(in millions)
Cost of Product Sold
Accelerated depreciation		$	0.2			$	1.0
Flow through of inventory step-up			-				1.0
Cost of Product Sold			0.2				2.0

		For the Three Months
		Ended May 31,
		2011				2010
(in millions)
Selling, General and Administrative Expenses
Net foreign currency loss on contractual obligation from put option of Ruffino shareholder			2.2				-
Net gains on CWAE Divestiture and related activities			(0.8	)			-
Net gains on sale of nonstrategic assets			-				(1.0	)
Acquisition-related integration costs			-				0.1
Other costs			1.1				0.9
Selling, General and Administrative Expenses			2.5				-
Restructuring Charges			11.1				4.9
Restructuring Charges and Unusual Items		$	13.8			$	6.9

          The Company evaluates performance based on operating income of the respective business units. The accounting policies of the segments are the same as those described for the Company in the Summary of Significant Accounting Policies in Note 1 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended February 28, 2011, and include the recently adopted accounting guidance described in Note 2 herein.

          Segment information is as follows:

		For the Three Months
		Ended May 31,
		2011				2010
(in millions)
CWNA:
Net sales		$	635.3			$	589.9
Segment operating income		$	136.6			$	132.5
Equity in earnings of equity method investees		$	2.4			$	0.1
Long-lived tangible assets		$	1,106.1			$	1,090.9
Investment in equity method investees		$	82.0			$	74.8
Total assets		$	6,668.5			$	6,453.8
Capital expenditures		$	13.7			$	13.8
Depreciation and amortization		$	21.2			$	22.8
CWAE:
Net sales		$	-			$	197.6
Segment operating (loss) income		$	-			$	(2.8	)
Equity in earnings of equity method investees		$	-			$	0.6
Long-lived tangible assets		$	-			$	343.2
Investment in equity method investees		$	-			$	34.2
Total assets		$	-			$	1,156.6
Capital expenditures		$	-			$	1.4
Depreciation and amortization		$	-			$	7.8
Corporate Operations and Other:
Net sales		$	-			$	-
Segment operating loss		$	(21.1	)		$	(26.5	)
Long-lived tangible assets		$	124.6			$	88.8
Total assets		$	223.2			$	140.8
Capital expenditures		$	7.3			$	10.4
Depreciation and amortization		$	5.7			$	4.0

		For the Three Months
		Ended May 31,
		2011				2010
(in millions)
Crown Imports:
Net sales		$	677.5			$	621.5
Segment operating income		$	119.8			$	108.9
Long-lived tangible assets		$	5.2			$	4.7
Total assets		$	466.7			$	362.8
Capital expenditures		$	0.9			$	0.2
Depreciation and amortization		$	0.5			$	0.5
Restructuring Charges and Unusual Items:
Operating loss		$	(13.8	)		$	(6.9	)
Equity in losses of equity method investees		$	-			$	(0.5	)
Consolidation and Eliminations:
Net sales		$	(677.5	)		$	(621.5	)
Operating income		$	(119.8	)		$	(108.9	)
Equity in earnings of Crown Imports		$	59.8			$	54.3
Long-lived tangible assets		$	(5.2	)		$	(4.7	)
Investment in equity method investees		$	183.7			$	144.9
Total assets		$	(283.0	)		$	(217.9	)
Capital expenditures		$	(0.9	)		$	(0.2	)
Depreciation and amortization		$	(0.5	)		$	(0.5	)
Consolidated:
Net sales		$	635.3			$	787.5
Operating income		$	101.7			$	96.3
Equity in earnings of equity method investees		$	62.2			$	54.5
Long-lived tangible assets		$	1,230.7			$	1,522.9
Investment in equity method investees		$	265.7			$	253.9
Total assets		$	7,075.4			$	7,896.1
Capital expenditures		$	21.0			$	25.6
Depreciation and amortization		$	26.9			$	34.6