Download - Delivers Solid Business Performance and Generates Strong

DeliversSolidBusinessPerformanceandGeneratesStrongCashFlowBeerBusinessAchievesDepletionGrowthof5.6%,orNearly7%AdjustedforSellDayImpact

BeerProductioninMexicoReturnstoNormalLevels;Wine&SpiritsPowerBrandsContinuetoGainTraction

NetSales

OperatingIncome

EarningsBeforeInterest&Taxes

(EBIT)

DilutedNetIncome(Loss)PerShare

AttributabletoCBI(EPS)

DilutedEPSExcludingCanopy

FirstQuarterFiscalYear2021FinancialHighlights(1)|Inmillions,exceptpersharedata

Reported $1,963 $610 NA $(0.94) NA

%Change (6%) (2%) NA 28% NA

Comparable $1,963 $691 $663 $2.30 $2.44

%Change (6%) (1%) 3% 4% 2%(1)Definitionsofreported,comparable,andorganic,aswellasreconciliationsofnon-GAAPfinancialmeasures,arecontainedelsewhereinthisnewsrelease.NA=NotApplicable

HIGHLIGHTS• DespiteCOVID-relatedchallenges,generatesreportedbasisEPS

of$(0.94)andcomparablebasisEPSof$2.30,includingCanopyGrowthequitylossesof$0.14;excludingCanopyGrowthequitylosses,achievedcomparablebasisEPSof$2.44

• Generates$687millionofoperatingcashflowand$542millionoffreecashflow,anincreaseof16%and24%,respectively

• Beerdepletionsremainstrongandconsistentwithlong-termtrends;productioninMexicoreturnstonormallevelsinJune

• Wine&spiritspremiumizationstrategygainsmomentum,withstrongPowerBrandsperformanceinIRIchannels

• Fullyredeemsoutstanding2.25%SeniorNotesdueNovember2020

• Declaresquarterlycashdividendof$0.75pershareClassAand$0.68pershareClassBcommonstock

• Contributesnearly$4millioninCOVID-19relatedsupport• SignsagreementstosellNobiloNewZealandSauvignonBlancand

PaulMassonGrandeAmberBrandy• AcquiresEmpathyWines,adigitally-nativewinebrand,which

strengthensthecompany’spositioninthedirect-to-consumerandeCommercemarketswithinthewineandspiritscategory

• Fiscal2021guidanceisunavailableatthistimeduetotheuncertaintyandpotentialimpactsonthebusinessfromCOVID-19

“WeovercameanumberofheadwindstodeliversolidfirstquarterresultsmarkedbymarginimprovementandimpressivedepletiongrowthforourBeerBusinessandourWine&SpiritsPowerBrandportfolio.WhiletheslowdownofourMexicanbeerproductionduetoCOVID-19createdshort-termimpacttodistributorinventorylevels,shipments,andnetsales,wecontinuetowininsaleschannelsthatareopen,consumerdemandforourbrandsremainsstrong,andouroutlookfortheyearremainspositive.”

“Ourstrongcashflowresultsprovidefinancialflexibilityaswecontinuetofocusonreducingourdebtlevels.Duringthequarterwerefinanceddebtatfavorableratestoenhanceliquidityduringthistimeofuncertainty.”

BillNewlands GarthHankinson

PresidentandChiefExecutiveOfficer ChiefFinancialOfficer

ConstellationBrands,Inc.Q1FY2021EarningsRelease #WORTHREACHINGFORI1

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beerShipmentVolume

OrganicShipmentVolume(2)

DepletionVolume(2) NetSales(3)

OrganicNetSales(1)

OperatingIncome(3)

ThreeMonthsEnded|Inmillions;brandedproduct,24-pack,12-ouncecaseequivalentsMay31,2020 76.2 76.2 $1,384.1 $1,384.1 $577.8May31,2019 82.1 81.3 $1,477.4 $1,448.8 $580.6%Change (7.2%) (6.3%) 5.6% (6%) (4%) —%(2)

ThreemonthsendedMay31,2019,includesanadjustmenttoremovevolumeassociatedwiththeBallastPointcraftbeerbusiness“BallastPointDivestiture”fortheperiodMarch2,2019,throughMay31,2019.

(3)ThreemonthsendedMay31,2019,includes$28.6millionofnetsalesand$3.8millionofgrossprofitlessmarketingthatarenolongerpartofthebeersegmentresultsaftertheBallastPointDivestiture.

HIGHLIGHTS• Constellation’sBeerBusinessposteddepletiongrowthof5.6%as

strongperformanceinoff-premisechannelsmorethanoffsettheimpactofthe75%reductionintheon-premisechannelduetoCOVID-19relatedshut-downs.Whenadjustedforonelesssellingdayinthequarter,thebeerbusinessgeneratednearly7%depletiongrowth.

• TheCoronaBrandFamilygrewdouble-digitsinIRIchannelsdrivenbytheacceleratedgrowthofCoronaExtra,thesuccessfullaunchofCoronaHardSeltzer,andthecontinuedstrengthofCoronaPremierandCoronaRefresca.

• WiththesuccessfullaunchofCoronaHardSeltzer,thebrandhasquicklybecomethe#4hardseltzerplayer,approaching6%IRImarketshareintheU.S.hardseltzercategory.OngoingdistributiongainshaveledtoIRIACVdistributionofnearly65sinceproductlaunchinearlyMarch.

• ModeloEspecialcontinuestoseeacceleratingconsumertakeawaytrendsinIRIchannelsanddelivered12%depletiongrowthduringthequarter.

• ImpactsfromtheCOVID-19relatedslowdownofbeerproductioninMexicoimpactedshipmentvolumesanddistributorinventorylevelsandwillextendintoQ2.Productinventoriesareexpectedtoreturntomorenormallevelsduringthethirdquarterfiscal2021;long-termoutlookremainsintact.

• Operatingmarginincreased240basispointsto41.7%,asbenefitsfromtimingofmarketingspendandfavorablepricingwerepartiallyoffsetbyincreasedCOGS.

wineandspiritsShipmentVolume

OrganicShipmentVolume(4)

DepletionVolume(4) NetSales(5)

OrganicNetSales(1)

OperatingIncome(5)

ThreeMonthsEnded|Inmillions;brandedproduct,9-litercaseequivalentsMay31,2020 10.8 10.8 $579.3 $579.3 $164.0May31,2019 12.4 11.9 $619.8 $601.1 $160.8%Change (12.9%) (9.2%) (1.1%) (7%) (4%) 2%(4)

ThreemonthsendedMay31,2019,includesanadjustmenttoremovevolumeassociatedwiththeBlackVelvetCanadianWhiskybusiness“BlackVelvetDivestiture”fortheperiodMarch1,2019,throughMay31,2019.

(5)ThreemonthsendedMay31,2019,includes$18.7millionofnetsalesand$8.3millionofgrossprofitlessmarketingthatarenolongerpartofthewineandspiritssegmentresultsaftertheBlackVelvetDivestiture.

HIGHLIGHTS• ThePowerBrandsarewinninginthehigher-endandacrossthe

majorityofpricesegmentsoftheU.S.Winecategorywithstrongvelocity,anddistributiongainsthatareoutpacingthemarket.PowerBranddepletionvolumegrew5%drivenbyKimCrawford,Meiomi,SVEDKA,ThePrisonerBrandFamily,andWoodbridgebyRobertMondavi.

• InnovationinitiativesaredrivinggrowthwithPowerBrandslikeThePrisonerUnshackledandRobertMondaviPrivateSelectionButteryChardonnay.

• Operatingmarginincreased240basispointsto28.3%asbenefitsfromprice,SG&A,andmixwerepartiallyoffsetbytheBlackVelvetDivestitureandhigherCOGS.

• EmpathyWinesacquisitionreinforcesandsupportsthecompany’sdirect-to-consumerand3-tiereCommercestrategy,asconsumerscontinuetomigratetothesechannels.


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InformationRelatedtotheWineandSpiritsBusinessestobeSoldThefurtherrevisedWineandSpiritstransactiontosellaportionofthebusinesstoE.&J.GalloWinery(“Gallo”)(the“FurtherRevisedWineandSpiritsTransaction”)isnowassumedtocloseduringQ2fiscal2021andtheseparate,butrelated,agreementtodivesttheNobiloWinebrandtoGallo(the“NobiloTransaction”)isassumedtoclosebytheendofQ2offiscal2021.Inaddition,thecompanyintendstodivestthePaulMassonGrandeAmberBrandybrandandtheconcentratebusinessinseparatetransactionsthatareassumedtocloseduringQ2fiscal2021andplanstoretaintheCooksandJ.RogetbrandsandtheMissionBellWinery.

Thefollowingtablepresentsestimatedselectedwineandspiritssegmentfinancialinformationincludedinourconsolidatedfinancialstatementsthatwillnolongerbepartofourconsolidatedresultsafterthesetransactions:

EstimatedInformationforWineandSpiritsBusinessestobeSold FY20Q2 FY20Q3 FY20Q4 FY21Q1

(inmillions)Shipmentvolume(9-litercaseequivalents) 5.8 4.7 6.1 4.5

Netsales $229 $179 $237 $187

CAM(grossprofitlessmarketing) $83 $62 $84 $77

Inaddition,thecompanysoldtheBlackVelvetCanadianWhiskybusinessonNovember1,2019.Theapproximatefiscal2020shipmentvolume,netsales,andgrossprofitlessmarketingtotaled1.6million9-litercaseequivalents,$50.3million,and$23.2million,respectively.

AsaresultoftheFurtherRevisedWineandSpiritstransactions,astrandedcostreductionplanof$130millionisexpectedtoberealizedoverthefiscal2021tofiscal2022timeframe.

DOINGOURPARTTODRIVEMEANINGFULANDLASTINGCHANGETheconditionsthathaveallowedsystemicracialinjusticetopersistintheU.S.haveexistedfartoolong.Wemustdobetterasindividuals,asacompany,andasacountry.TolearnmoreaboutcommitmentsourcompanyismakingtoachievegreaterequityforourAfricanAmerican/BlackcolleaguesatConstellation,withinourindustry,andwithinthecommunitieswhereweliveandwork,visitwww.cbrands.com/news.

Initiatives:

• Committedtoinvest$100milliontosupportAfricanAmerican/Blackandminority-ownedstartupsinthebeveragealcoholspaceandrelatedcategoriesoverthenext10years.

• Enteredamulti-yearpartnershipwiththeEqualJusticeInitiative,includinganinvestmentof$1milliontofurtherEJI'smissionandprovidetrainingopportunitiesforConstellationleadership.

RALLYINGAROUNDOURCOMMUNITIESANDINDUSTRYPARTNERSTOSUPPORTCOVID-19RELIEFEFFORTSWHILEKEEPINGEMPLOYEES’SAFETYTHE#1PRIORITY

Constellationhasworkedtirelesslytohelppavethepathtorecoveryforindustrypartnerssuchaslocalrestaurantsandbarsandat-riskcommunitiesdisproportionatelyimpactedbyCOVID-19,includingHispanicandAfricanAmerican/Blackcommunities,acrosstheU.S.Tolearnmoreaboutourcorporatesocialresponsibilityefforts,visitour2020CorporateSocialResponsibilityreport.

• NationalRestaurantAssociationEducationFoundation:Donatedmorethan$1.5milliontohelpproviderelieftoover40,000restaurantworkerswhosejobswereimpactedbytheCOVID-19pandemic.

• #FirstRespondersFirst:Donatednearly$1milliontohelpprovideequipmentandsupporttoserveonthefrontlines,helpingthosemostinneedincommunitiesacrosstheU.S.

• U.S.Bartenders’GuildNationalCharityFund:Provided$500,000tobartendersandsupportstaffwhowereforcedoutofworkduetoCOVID-19.

• MexicanRedCross:Contributed$500,000tohelpfirstresponderswithneededmedicalsuppliesinMexico.

• HealthcareprofessionalsinVenetoRegioninItaly:Providedmuch-neededsupporttothehard-hitVenetoregion,contributing$250,000toprovidehospitalsuppliestohealthcareprofessionals.

• Implementedvariousmeasurestoreducethespreadofthevirusincludingworkingfromhome,restrictingvisitorstoourproductionlocations,reducingtheon-siteproductionworkforcelevels,screeningworkersbeforetheyenterfacilities,andimplementingsocialdistancing.

• SentthousandsoffacecoveringstoCBIteammembersacrossthecountryandouroperationsfacilities.


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QUARTERLYDIVIDEND

OnJune30,2020,Constellation’sboardofdirectorsdeclaredaquarterlycashdividendof$0.75pershareofClassACommonStockand$0.68pershareofClassBCommonStock,payableonAugust25,2020,tostockholdersofrecordasofthecloseofbusinessonAugust11,2020.

†Acopyofthisnewsrelease,includingtheattachmentsandotherfinancialinformationthatmaybediscussedduringthecall,willbeavailableonourwebsitecbrands.comunder“Investors/Reporting”priortothecall.

CANOPYGROWTHINVESTMENT

Constellation’sshareofCanopyGrowth’sequityearningsandrelatedactivitiesforfirstquarteroffiscal2021totaledalossof$377.6milliononareportedbasisandalossof$31.7milliononacomparablebasis.

Constellationhasrecognizeda$112millionunrealizednetgaininreportedbasisresultssincetheinitialCanopyinvestmentinNovember2017;$197milliondecreaseinthefairvalueofCanopyinvestmentswasrecognizedforfirstquarteroffiscal2021.

OnMay1,2020,ConstellationexercisedtheNovember2017CanopyWarrantsatanexercisepriceofC$12.98perwarrantshareforC$245.0million,or$173.9million.OnMay1,2020,Constellation’sownershipinterestinCanopyincreasedto38.6%.TheclosingstockpriceonthedateofexercisewasC$21.43.

LEADERSHIPPERSPECTIVESOurteamputsitsdeepexperienceinbusiness,strategy,andleadershiptowork,shapinganenvironmentwherewerealizeourambitionsandbeliefs.IntheLeadershipPerspectiveblog,PresidentandCEOBillNewlandsandotherConstellationthoughtleaderssharetheirvisionforthebrands,insightsabouttheindustry,andtheculturalfoundationsthatdriveourcompanyforward.WeinviteyoutojoinusaswebuildafutureWorthReachingFor.

3-TiereCommerce:UnderstandingOurEvolvingDigitalConsumerinanUnexpectedTime

ABOUTCONSTELLATIONBRANDSAtConstellationBrands(NYSE:STZandSTZ.B),ourmissionistobuildbrandsthatpeoplelovebecausewebelievesharingatoast,unwindingafteraday,celebratingmilestones,andhelpingpeopleconnect,areWorthReachingFor.It’sworthourdedication,hardwork,andtheboldcalculatedriskswetaketodelivermoreforourconsumers,tradepartners,shareholders,andcommunitiesinwhichweliveandwork.It’swhathasmadeusoneofthefastest-growinglargeCPGcompaniesintheU.S.atretail,anditdrivesourpursuittodeliverwhat’snext.

Today,wearealeadinginternationalproducerandmarketerofbeer,wine,andspiritswithoperationsintheU.S.,Mexico,NewZealand,andItaly.Everyday,peoplereachforourhigh-end,iconicimportedbeerbrandssuchasCoronaExtra,CoronaLight,CoronaPremier,ModeloEspecial,ModeloNegra,andPacifico,andourhigh-qualitypremiumwineandspiritsbrands,includingtheRobertMondaviBrandFamily,KimCrawford,Meiomi,ThePrisonerBrandFamily,SVEDKAVodka,CasaNobleTequila,andHighWestWhiskey.

Butwewon’tstophere.Ourvisionaryleadershipteamandpassionateemployeesfrombarrelroomtoboardroomarereachingforthenextlevel,toexploretheboundariesofthebeveragealcoholindustryandbeyond.Joinusindiscoveringwhat’sWorthReachingFor.

Tolearnmore,[email protected].

MEDIACONTACTS INVESTORRELATIONSCONTACTSMikeMcGrew 773-251-4934 [email protected] PattyYahn-Urlaub 585-678-7483 [email protected] 585-678-7141 [email protected] BobCzudak 585-678-7170 [email protected]


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SUPPLEMENTALINFORMATIONReportedbasis(“reported”)areamountsasreportedundergenerallyacceptedaccountingprinciples.Comparablebasis(“comparable”)areamountswhichexcludeitemsthataffectcomparability(“comparableadjustments”),astheyarenotreflectiveofcoreoperationsofthesegments.Thecompany’smeasureofsegmentprofitabilityexcludescomparableadjustments,whichisconsistentwiththemeasureusedbymanagementtoevaluateresults.Thecompanydiscussesvariousnon-GAAPmeasuresinthisnewsrelease.Financialstatements,aswellassupplementalschedulesandtablesreconcilingnon-GAAPmeasures,togetherwithdefinitionsofthesemeasuresandthereasonsmanagementusesthesemeasures,areincludedinthisnewsrelease.

FORWARD-LOOKINGSTATEMENTSAllstatementsotherthanstatementsofhistoricalfactsetforthinthisnewsreleaseregardingConstellationBrands’businessstrategy,futureoperations,futurefinancialposition,estimatedrevenues,projectedcosts,expectednetsalesandoperatingincome,expectedcashflow,futurepaymentsofdividends,andprospects,plansandobjectivesofmanagement,aswellasinformationconcerningexpectedactionsofthirdparties,areforward-lookingstatements(collectively,the“Projections”)thatinvolverisksanduncertaintiesthatcouldcauseactualresultstodiffermateriallyfromthosesetforthinorimpliedbytheProjections.

Duringthecurrentquarter,ConstellationBrandsmayreiteratetheProjections.Priortothestartofthecompany’squietperiod,whichwillbeginatthecloseofbusinessonAugust31,2020,thepubliccancontinuetorelyontheProjectionsasstillbeingConstellationBrands’currentexpectationsonthematterscovered,unlessthecompanypublishesanoticestatingotherwise.DuringConstellationBrands’“quietperiod,”theProjectionsshouldnotbeconsideredtoconstitutethecompany’sexpectationsandshouldbeconsideredhistorical,speakingasofpriortothequietperiodonlyandnotsubjecttoupdatebythecompany.

TheProjectionsarebasedonmanagement’scurrentexpectationsand,unlessotherwisenoted,donottakeintoaccounttheimpactofanyfutureacquisition,merger,oranyotherbusinesscombination,divestiture,restructuring,orotherstrategicbusinessrealignments,financingorsharerepurchasethatmaybecompletedafterthedateofthisrelease.TheProjectionsshouldnotbeconstruedinanymannerasaguaranteethatsuchresultswillinfactoccur.TheactualimpactofCOVID-19anditsassociatedoperatingenvironmentmaybemateriallydifferentthanmanagement’sexpectations.ThependingFurtherRevisedWineandSpiritsTransactionandthependingNobiloTransaction,thependingPaulMassonGrandeAmberBrandytransaction,andthependingconcentratebusinesstransaction(collectively,the“WineandSpiritsTransactions”)areeachsubjecttothesatisfactionofcertainclosingconditions,including,butnotlimitedto,receiptofrequiredregulatoryclearances.TheNobiloTransactionisalsoconditionedoncompletionoftheFurtherRevisedWineandSpiritsTransaction.TherecanbenoassurancetheWineandSpiritsTransactionswilloccurorwilloccuronthetermsortimetablescontemplatedhereby.

Inadditiontotherisksanduncertaintiesofordinarybusinessoperations,theProjectionsofthecompanycontainedinthisnewsreleasearesubjecttoanumberofrisksanduncertainties,including:

• durationandimpactoftheCOVID-19pandemic,includingbutnotlimitedtoclosureofnon-essentialbusinesses,whichmayincludeourmanufacturingfacilities,andothergovernmentalcontainmentactions;

• completionofthependingWineandSpiritsTransactions;

• impactoftheWineandSpiritsTransactions,amountanduseofexpectedproceedsfromthependingtransactions,amountofstrandedcosts,andamountandtimingofcostreductionsmayvaryfrommanagement’scurrentexpectations;

• amountofcontingentconsideration,ifany,receivedintheFurtherRevisedWineandSpiritsTransactionwilldependonactualbrandperformance;

• beeroperationsexpansion,construction,andoptimizationactivities,andcostsandtimingassociatedwiththeseactivities,mayvaryfrommanagement’scurrentestimates;

• accuracyofsupplyprojections,includingthoserelatingtobeeroperationsexpansionactivitiesandglasssourcing;

• operatingcashflow,freecashflow,effectivetaxrate,andcapitalexpenditurestosupportlong-termgrowthmayvaryfrommanagement’scurrentestimates;

• accuracyofprojectionsassociatedwithmarketopportunitiesandwithpreviouslyannouncedacquisitions,investments,anddivestitures;

• accuracyofprojectionsrelatingtotheCanopyinvestmentsmayvaryfrommanagement’scurrentexpectations;

• exactdurationofthesharerepurchaseimplementationandtheamount,timing,andsourceoffundsforanysharerepurchases;

• amountandtimingoffuturedividendsaresubjecttothedeterminationanddiscretionoftheboardofdirectors;

• rawmaterialandwatersupply,productionorshipmentdifficultiescouldadverselyaffectthecompany’sabilitytosupplyitscustomers;

• generaleconomic,geo-political,domestic,internationalandregulatoryconditions,instabilityinworldfinancialmarkets,healthepidemicsorpandemics,quarantinesorcurfews,unanticipatedenvironmentalliabilitiesandcosts,orenhancedcompetitiveactivities;

• changestointernationaltradeagreementsandtariffs,accountingstandards,electionsorassertions,taxlawsorothergovernmentalrulesandregulations,andotherfactorswhichcouldimpactthecompany’sreportedfinancialposition,resultsofoperations,oreffectivetaxrate,andaccuracyofanyassociatedprojections;

• changesininterestratesandtheinherentunpredictabilityofcurrencyfluctuations,commodityprices,andrawmaterialcosts;and

• otherfactorsanduncertaintiesdisclosedinthecompany’sfilingswiththeSecuritiesandExchangeCommission,includingitsAnnualReportonForm10-KforthefiscalyearendedFebruary29,2020,whichcouldcauseactualfutureperformancetodifferfromcurrentexpectations.


CONSTELLATIONBRANDS,INC.ANDSUBSIDIARIESCONDENSEDCONSOLIDATEDBALANCESHEETS

(inmillions)(unaudited)

May31,2020

February29,2020

ASSETS

Currentassets:

Cashandcashequivalents $ 302.8 $ 81.4

Accountsreceivable 700.5 864.8

Inventories 1,332.6 1,373.6

Prepaidexpensesandother 470.1 535.8

Assetsheldforsale-current 590.2 628.5

Totalcurrentassets 3,396.2 3,484.1

Property,plant,andequipment 5,098.2 5,333.0

Goodwill 7,684.9 7,757.1

Intangibleassets 2,735.4 2,718.9

Equitymethodinvestments 2,885.7 3,093.9

Securitiesmeasuredatfairvalue 809.5 1,117.1

Deferredincometaxes 2,599.5 2,656.3

Assetsheldforsale 376.4 552.1

Otherassets 564.0 610.7

Totalassets $ 26,149.8 $ 27,323.2

LIABILITIESANDSTOCKHOLDER’SEQUITY

Currentliabilities:

Short-termborrowings $ — $ 238.9

Currentmaturitiesoflong-termdebt 534.7 734.9

Accountspayable 505.5 557.6

Otheraccruedexpensesandliabilities 712.2 780.4

Totalcurrentliabilities 1,752.4 2,311.8

Long-termdebt,lesscurrentmaturities 11,639.3 11,210.8

Deferredincometaxesandotherliabilities 1,380.5 1,326.3

Totalliabilities 14,772.2 14,848.9

CBIstockholders’equity 11,066.0 12,131.8

Noncontrollinginterests 311.6 342.5

Totalstockholders’equity 11,377.6 12,474.3

Totalliabilitiesandstockholders’equity $ 26,149.8 $ 27,323.2


CONSTELLATIONBRANDS,INC.ANDSUBSIDIARIESCONSOLIDATEDSTATEMENTSOFOPERATIONS

(inmillions,exceptpersharedata)(unaudited)

ThreeMonthsEnded

May31,2020

May31,2019

Sales $ 2,131.7 $ 2,282.5

Excisetaxes (168.3) (185.3)

Netsales 1,963.4 2,097.2

Costofproductsold (975.1) (1,068.5)

Grossprofit 988.3 1,028.7

Selling,general,andadministrativeexpenses (353.3) (406.0)

Impairmentofassetsheldforsale (25.0) —

Operatingincome(loss) 610.0 622.7

Income(loss)fromunconsolidatedinvestments (571.2) (930.6)

Interestexpense (100.0) (114.6)

Lossonextinguishmentofdebt (7.0) —

Income(loss)beforeincometaxes (68.2) (422.5)

(Provisionfor)benefitfromincometaxes (104.4) 185.4

Netincome(loss) (172.6) (237.1)

Netincome(loss)attributabletononcontrollinginterests (5.3) (8.3)

Netincome(loss)attributabletoCBI $ (177.9) $ (245.4)

Netincome(loss)percommonshareattributabletoCBI:

BasicandDiluted–ClassACommonStock $ (0.94) $ (1.30)

BasicandDiluted–ClassBConvertibleCommonStock $ (0.86) $ (1.19)

Weightedaveragecommonsharesoutstanding:

BasicandDiluted–ClassACommonStock 169.604 168.118

BasicandDiluted–ClassBConvertibleCommonStock 23.293 23.317

Cashdividendsdeclaredpercommonshare:

ClassACommonStock $ 0.75 $ 0.75

ClassBConvertibleCommonStock $ 0.68 $ 0.68


CONSTELLATIONBRANDS,INC.ANDSUBSIDIARIESCONSOLIDATEDSTATEMENTSOFCASHFLOWS


ThreeMonthsEnded

May31,2020

May31,2019

CASHFLOWSFROMOPERATINGACTIVITIESNetincome(loss) $ (172.6) $ (237.1)Adjustmentstoreconcilenetincome(loss)tonetcashprovidedbyoperatingactivities:

Unrealizednet(gain)lossonsecuritiesmeasuredatfairvalue 197.3 827.5Deferredtaxprovision(benefit) 98.9 (245.4)Depreciation 71.0 86.6Stock-basedcompensation 14.6 15.5

Equityin(earnings)lossesofequitymethodinvesteesandrelatedactivities,netofdistributedearnings 373.9 91.1Noncashleaseexpense 20.9 22.8Impairmentofassetsheldforsale 25.0 —Lossoninventoryandrelatedcontracts 24.3 44.5Lossonsettlementoftreasurylockcontracts (29.3) —Changeinoperatingassetsandliabilities,netofeffectsfrompurchasesofbusinesses:

Accountsreceivable 167.0 58.6Inventories 48.6 (50.3)Prepaidexpensesandothercurrentassets 40.5 (8.7)Accountspayable (28.4) (22.3)Deferredrevenue 34.4 53.1Otheraccruedexpensesandliabilities (155.5) (77.4)

Other (44.1) 34.6Totaladjustments 859.1 830.2Netcashprovidedby(usedin)operatingactivities 686.5 593.1

CASHFLOWSFROMINVESTINGACTIVITIESPurchasesofproperty,plant,andequipment (144.2) (155.7)Purchasesofbusinesses,netofcashacquired — (36.2)Investmentsinequitymethodinvesteesandsecurities (213.4) (20.0)Proceedfromsalesofassets 17.7 0.3Proceedsfromsaleofbusiness 41.1 —Otherinvestingactivities (0.3) (1.9)

Netcashprovidedby(usedin)investingactivities (299.1) (213.5)CASHFLOWSFROMFINANCINGACTIVITIES

Proceedsfromissuanceoflong-termdebt 1,194.6 —Principalpaymentsoflong-termdebt (959.5) (22.9)Netproceedsfrom(repaymentsof)short-termborrowings (238.9) (205.0)Dividendspaid (143.9) (143.0)Proceedsfromsharesissuedunderequitycompensationplans 4.4 10.4Paymentsofminimumtaxwithholdingsonstock-basedpaymentawards (7.6) (13.9)Paymentsofdebtissuance,debtextinguishment,andotherfinancingcosts (18.1) —

Netcashprovidedby(usedin)financingactivities (169.0) (374.4)

Effectofexchangeratechangesoncashandcashequivalents 3.0 (0.1)

Netincrease(decrease)incashandcashequivalents 221.4 5.1Cashandcashequivalents,beginningofperiod 81.4 93.6Cashandcashequivalents,endofperiod $ 302.8 $ 98.7


CONSTELLATIONBRANDS,INC.ANDSUBSIDIARIESRECONCILIATIONOFREPORTEDANDORGANICNETSALES


Forperiodsofacquisition,wedefineorganicnetsalesascurrentperiodreportednetsaleslessnetsalesofproductsofacquiredbusinessesreportedforthecurrentperiod,asappropriate.Forperiodsofdivestiture,wedefineorganicnetsalesaspriorperiodreportednetsaleslessnetsalesofproductsofdivestedbusinessesreportedforthepriorperiod,asappropriate.Weprovideorganicnetsalesbecauseweusethisinformationinmonitoringandevaluatingtheunderlyingbusinesstrendsofourcoreoperations.Inaddition,webelievethisinformationprovidesinvestorsvaluableinsightonunderlyingbusinesstrendsandresultsinordertoevaluateyear-over-yearfinancialperformance.

ThedivestituresimpactingtheperiodbelowconsistoftheBlackVelvetDivestiture(soldNovember1,2019)andtheBallastPointDivestiture(soldMarch2,2020).

ThreeMonthsEnded

May31,2020

May31,2019

PercentChange

Consolidatednetsales $ 1,963.4 $ 2,097.2 (6%)Less:BlackVelvetDivestiture(1) — (18.7)Less:BallastPointDivestiture(2) — (28.6)

Consolidatedorganicnetsales $ 1,963.4 $ 2,049.9 (4%)

Beernetsales $ 1,384.1 $ 1,477.4 (6%)

Less:BallastPointDivestiture(2) — (28.6)

Beerorganicnetsales $ 1,384.1 $ 1,448.8 (4%)

WineandSpiritsnetsales $ 579.3 $ 619.8 (7%)Less:BlackVelvetDivestiture(1) — (18.7)

WineandSpiritsorganicnetsales $ 579.3 $ 601.1 (4%)

(1) FortheperiodMarch1,2019,throughMay31,2019,includedinthethreemonthsendedMay31,2019.(2) FortheperiodMarch2,2019,throughMay31,2019,includedinthethreemonthsendedMay31,2019.


CONSTELLATIONBRANDS,INC.ANDSUBSIDIARIESSUPPLEMENTALSHIPMENTANDDEPLETIONINFORMATION

(unaudited)

ThreeMonthsEnded

May31,2020

May31,2019

PercentChange

Beer

(inmillions,brandedproduct,24-pack,12-ouncecaseequivalents)

Shipmentvolume 76.2 82.1 (7.2%)

Organicshipmentvolume(1) 76.2 81.3 (6.3%)

Depletionvolume(2)(3) 5.6%

WineandSpirits

(inmillions,brandedproduct,9-litercaseequivalents)

Shipmentvolume 10.8 12.4 (12.9%)

Organicshipmentvolume(4) 10.8 11.9 (9.2%)

U.S.Domesticshipmentvolume 9.9 11.3 (12.4%)

U.S.Domesticorganicshipmentvolume(4) 9.9 10.8 (8.3%)

U.S.DomesticPowerBrandsshipmentvolume(5) 5.0 4.5 11.1%

U.S.Domesticdepletionvolume(2)(6) (1.1%)

U.S.DomesticPowerBrandsdepletionvolume(2)(5) 4.7%

(1) IncludesanadjustmenttoremoveshipmentvolumeassociatedwiththeBallastPointDivestiturefortheperiodMarch2,2019,throughMay31,2019,forthethreemonthsendedMay31,2019.

(2) Depletionsrepresentdistributorshipmentsofourrespectivebrandedproductstoretailcustomers,basedonthird-partydata.

(3) IncludesanadjustmenttoremovedepletionvolumeassociatedwiththeBallastPointDivestiturefortheperiodMarch2,2019,throughMay31,2019,forthethreemonthsendedMay31,2019.

(4) IncludesanadjustmenttoremoveshipmentvolumeassociatedwiththeBlackVelvetDivestiturefortheperiodMarch1,2019,throughMay31,2019,forthethreemonthsendedMay31,2019.

(5) U.S.DomesticPowerBrandsincludethefollowingbrandsand/orportfolioofbrands:

WineBrandsWinePortfolioof

Brands SpiritsBrands

● 7Moons ● Drylands ● SIMI ● CharlesSmith ● CasaNoble

● Auros ● KimCrawford ● SpokenBarrel ● Prisoner ● HighWest

● ChampagnePalmer&Co ● Meiomi ● RobertMondavi ● MiCAMPO

● Cooper&Thief ● MountVeeder ● Schrader ● Nelson’sGreenBrier

● CraftersUnion ● Nobilo(7) ● SVEDKA

● CuvéeSauvage ● Ruffino ● TheRealMcCoy(6) IncludesanadjustmenttoremovedepletionvolumeassociatedwiththeBlackVelvetDivestiturefortheperiodMarch1,

2019,throughMay31,2019,forthethreemonthsendedMay31,2019.(7) Brandisexpectedtobedivestedbytheendofsecondquarteroffiscal2021.


CONSTELLATIONBRANDS,INC.ANDSUBSIDIARIESSUMMARIZEDSEGMENTANDINCOME(LOSS)FROMUNCONSOLIDATEDINVESTMENTSINFORMATION


ThreeMonthsEndedMay31,2020

May31,2019

PercentChange

BeerSegmentnetsales $ 1,384.1 $ 1,477.4 (6%)Segmentgrossprofit $ 769.7 $ 819.5 (6%)

%Netsales 55.6% 55.5%Segmentoperatingincome(loss) $ 577.8 $ 580.6 —%

%Netsales 41.7% 39.3%

WineandSpiritsWinenetsales $ 499.6 $ 535.0 (7%)Spiritsnetsales 79.7 84.8 (6%)

Segmentnetsales $ 579.3 $ 619.8 (7%)Segmentgrossprofit $ 263.9 $ 271.7 (3%)

%Netsales 45.6% 43.8%Segmentoperatingincome(loss) $ 164.0 $ 160.8 2%

%Netsales 28.3% 25.9%Segmentincome(loss)fromunconsolidatedinvestments $ 3.5 $ 4.0 (13%)

CorporateOperationsandOtherSegmentoperatingincome(loss) $ (50.5) $ (43.7) (16%)Segmentincome(loss)fromunconsolidatedinvestments $ 0.2 $ (1.1) NM

Canopyequityearnings(losses)(1) $ (31.7) $ (54.4) 42%

Consolidatedoperatingincome(loss) $ 610.0 $ 622.7 (2%)ComparableAdjustments 81.3 75.0 NM

Comparableoperatingincome(loss) $ 691.3 $ 697.7 (1%)

Consolidatedincome(loss)fromunconsolidatedinvestments $ (571.2) $ (930.6) 39%ComparableAdjustments 543.2 879.1 NM

Comparableincome(loss)fromunconsolidatedinvestments $ (28.0) $ (51.5) 46%

ConsolidatedEBIT $ 663.3 $ 646.2 3%

(1) Werecognizeourequityinearnings(losses)forCanopyonatwo-monthlag.Accordingly,werecognizedourshareofCanopy’searnings(losses)fortheperiodsJanuary1,2020,throughMarch31,2020,andJanuary1,2019,throughMarch31,2019,inourconsolidatedresultsforthethreemonthsendedMay31,2020,andMay31,2019,respectively.Thesummarizedfinancialinformationbelowrepresents100%ofCanopy’sreportedresults,preparedinaccordancewithgenerallyacceptedaccountingprinciplesintheU.S.(“GAAP”),andconvertedfromCanadiandollarstoU.S.dollarsusingtheapplicableweightedaverageexchangerates.

ThreeMonthsEnded

May31,2020

May31,2019

Netsales $ 80.3 $ 70.7

Grossprofit(loss) $ (57.3) $ 11.3

%Netsales (71.4)% 16.0%

Operatingincome(loss) $ (733.2) $ (170.0)

%Netsales NM NM

NM=NotMeaningful


CONSTELLATIONBRANDS,INC.ANDSUBSIDIARIESRECONCILIATIONSOFGAAPTONON-GAAPFINANCIALMEASURES


WereportourfinancialresultsinaccordancewithGAAP.However,non-GAAPfinancialmeasures,asdefinedinthereconciliationtablesbelow,areprovidedbecauseweusethisinformationinevaluatingtheresultsofourcoreoperationsand/orinternalgoalsetting.Inaddition,webelievethisinformationprovidesinvestorsvaluableinsightonunderlyingbusinesstrendsandresultsinordertoevaluateyear-over-yearfinancialperformance.Seethetablesbelowforsupplementalfinancialdataandcorrespondingreconciliationsofthesenon-GAAPfinancialmeasurestoGAAPfinancialmeasuresfortheperiodspresented.Non-GAAPfinancialmeasuresshouldbeviewedinadditionto,andnotasanalternativefor,ourreportedresultspreparedinaccordancewithGAAP.Pleaserefertoourwebsiteathttp://www.cbrands.com/investors/reportingforamoredetaileddescriptionandfurtherdiscussionofthesenon-GAAPfinancialmeasures.

ThreeMonthsEndedMay31,2020 ThreeMonthsEndedMay31,2019 PercentChange-ReportedBasis(GAAP)

PercentChange-

ComparableBasis

(Non-GAAP)

ReportedBasis(GAAP)

ComparableAdjustments

ComparableBasis

(Non-GAAP)

ReportedBasis(GAAP)


ComparableBasis

(Non-GAAP)

Netsales $ 1,963.4 $ 1,963.4 $ 2,097.2 $ 2,097.2 (6%) (6%)

Costofproductsold (975.1) $ 45.3 (1,068.5) $ 62.5

Grossprofit 988.3 45.3 $ 1,033.6 1,028.7 62.5 $ 1,091.2 (4%) (5%)

Selling,general,andadministrativeexpenses (353.3) 11.0 (406.0) 12.5

Impairmentofassetsheldforsale (25.0) 25.0 —

Operatingincome(loss) 610.0 81.3 $ 691.3 622.7 75.0 $ 697.7 (2%) (1%)

Income(loss)fromunconsolidatedinvestments (571.2) 543.2 (930.6) 879.1

EBIT $ 663.3 $ 646.2 NA 3%

Interestexpense (100.0) (114.6)

Lossonextinguishmentofdebt (7.0) 7.0 —

Income(loss)beforeincometaxes (68.2) 631.5 $ 563.3 (422.5) 954.1 $ 531.6 84% 6%

(Provisionfor)benefitfromincometaxes(1) (104.4) (5.9) 185.4 (278.9)

Netincome(loss) (172.6) 625.6 (237.1) 675.2

Netincome(loss)attributabletononcontrollinginterests (5.3) (8.3)

Netincome(loss)attributabletoCBI $ (177.9) $ 625.6 $ 447.7 $ (245.4) $ 675.2 $ 429.8 28% 4%

EPS(2) $ (0.94) $ 3.21 $ 2.30 $ (1.30) $ 3.46 $ 2.21 28% 4%

Weightedaveragecommonsharesoutstanding–diluted(3) 169.604 25.201 194.805 168.118 26.750 194.868

Grossmargin 50.3% 52.6% 49.1% 52.0%

Operatingmargin 31.1% 35.2% 29.7% 33.3%

Effectivetaxrate (153.1)% 19.6% 43.9% 17.6%

ConstellationBrands,Inc.Q1FY2021Form10-Q #WORTHREACHINGFORI12

ThreeMonthsEndedMay31,2020 ThreeMonthsEndedMay31,2019


Acquisitions,Divestitures,andRelatedCosts(4)

RestructuringandOtherStrategicBusiness

DevelopmentCosts(5) Other(6) Total

Acquisitions,Divestitures,andRelatedCosts(4)

RestructuringandOtherStrategicBusiness

DevelopmentCosts(5) Other(6) Total

Costofproductsold $ — $ (24.3)$ (21.0)$ (45.3) $ (0.4)$ (48.0)$ (14.1)$ (62.5)Selling,general,andadministrativeexpenses $ (1.4)$ (3.1)$ (6.5)$ (11.0) $ 9.2 $ (23.6)$ 1.9 $ (12.5)Impairmentofassetsheldforsale $ — $ (25.0)$ — $ (25.0) $ — $ — $ — $ —Operatingincome(loss) $ (1.4)$ (52.4)$ (27.5)$ (81.3) $ 8.8 $ (71.6)$ (12.2)$ (75.0)Income(loss)fromunconsolidatedinvestments $ (0.5)$ (235.4)$ (307.3)$ (543.2) $ (9.3)$ — $ (869.8)$ (879.1)Lossonextinguishmentofdebt $ — $ — $ (7.0)$ (7.0) $ — $ — $ — $ —(Provisionfor)benefitfromincometaxes(1) $ (23.6)$ 21.9 $ 7.6 $ 5.9 $ 54.2 $ 17.4 $ 207.3 $ 278.9Netincome(loss)attributabletoCBI $ (25.5)$ (265.9)$ (334.2)$ (625.6) $ 53.7 $ (54.2)$ (674.7)$ (675.2)

EPS(2) $ (0.13)$ (1.36)$ (1.72)$ (3.21) $ 0.28 $ (0.28)$ (3.46)$ (3.46)(1) TheeffectivetaxrateappliedtoeachComparableAdjustmentamountisgenerallybaseduponthejurisdictioninwhichtheComparableAdjustmentwasrecognized.Forthe

threemonthsendedMay31,2020,the(provisionfor)benefitfromincometaxesincludesanetincometaxprovisionrecognizedasaresultofadjustmentstovaluationallowancesandanetincometaxprovisionrelatedtolegislativeandgovernmentalinitiativesundertheCoronavirusAid,Relief,andEconomicSecurityAct(“CARESAct”).ForthethreemonthsendedMay31,2019,the(provisionfor)benefitfromincometaxesincludesnetincometaxbenefitprimarilyfromthereversalofavaluationallowancerelatedtocapitallosscarryforwardsasaresultofclassifyingassetsheldforsaleinconnectionwiththedefinitiveagreementtosellaportionofthewineandspiritsbusinesstoE.&J.GalloWinery.

(2) Maynotsumduetoroundingaseachitemiscomputedindependently.ForthethreemonthsendedMay31,2020,andMay31,2019,thecomparableadjustmentsandcomparablebasisdilutednetincomepersharearecalculatedonafullydilutivebasis.(3)

(3) Wehaveexcludedthefollowingweightedaveragecommonsharesoutstandingfromthecalculationofdilutednetincome(loss)percommonshare,astheeffectofincludingthesewouldhavebeenanti-dilutive,inmillions:

FortheThreeMonthsEndedMay31,2020 May31,2019

ClassBConvertibleCommonStock 23.293 23.317Stock-basedawards,primarilystockoptions 1.908 3.433

(4) ForthethreemonthsendedMay31,2020,acquisitions,divestitures,andrelatedcostsprimarilyconsistofanetincometaxprovisionrecognizedfortheadjustmentstovaluationallowancesandaanetlossonforeigncurrencycontracts,partiallyoffsetbyanetgainrecognizedinconnectionwithavineyardsale.ForthethreemonthsendedMay31,2019,acquisitions,divestitures,andrelatedcostsconsistprimarilyofanetincometaxbenefitrecognizedforthereversalofavaluationallowanceandagainrelatedtotheremeasurementofourpreviouslyheldequityinterestinNelson’sGreenBrierDistillerybusinesstotheacquisition-datefairvalue.

(5) ForthethreemonthsendedMay31,2020,restructuringandotherstrategicbusinessdevelopmentcostsconsistprimarilyofequitylossesfromCanopyGrowthCorporation(“Canopy”)relatedtocostsdesignedtoimprovetheirorganizationalfocus,streamlineoperations,andalignproductioncapabilitywithprojecteddemand.ThethreemonthsendedMay31,2020,alsoincludedcoststooptimizeourportfolio,gainefficiencies,reduceourcoststructure,andanimpairmentoflong-livedassetsheldforsalewithinthewineandspiritssegment.ForthethreemonthsendedMay31,2019,restructuringandotherstrategicbusinessdevelopmentcostsconsistprimarilyofcoststooptimizeourportfolio,gainefficiencies,andreduceourcoststructurewithinthewineandspiritssegment.

(6) ForthethreemonthsendedMay31,2020,otherconsistsprimarilyofanunrealizednetlossfromthemarktofairvalueofourinvestmentsinCanopy,costsassociatedwithCanopyequitylosses,anetincometaxprovisionrelatedtotheCARESAct,anetlossfromthemarktofairvalueofundesignatedcommodityderivativecontracts,andincrementalcostsincurredrelatedtotheCOVID-19pandemic.ForthethreemonthsendedMay31,2019,otherconsistsprimarilyofanunrealizednetlossfromthemarktofairvalueofourinvestmentsinCanopyandcostsassociatedwithCanopyequitylosses.

ConstellationBrands,Inc.Q1FY2021Form10-Q #WORTHREACHINGFORI13

CONSTELLATIONBRANDS,INC.ANDSUBSIDIARIESRECONCILIATIONSOFGAAPTONON-GAAPFINANCIALMEASURES(continued)


CanopyEquityEarnings(Losses)andRelatedActivities(“CanopyEIE”)CanopyEIEnon-GAAPfinancialmeasuresareprovidedbecausemanagementusesthisinformationtomonitorourinvestmentinCanopy.Inaddition,webelievethisinformationprovidesinvestorsvaluableinsightonunderlyingbusinesstrendsandresultsinordertoevaluateyear-over-yearfinancialperformance.

ThreeMonthsEnded

May31,2020

May31,2019

Equityearnings(losses)andrelatedactivities-reportedbasis,CanopyEIE(GAAP)(1) $ (377.6) $ (106.0)

ComparableAdjustments(2)(3) 345.9 51.6

Equitylossesandrelatedactivities-comparablebasis,CanopyEIE(Non-GAAP) (31.7) (54.4)

(Provisionfor)benefitfromincometaxes(3) 4.6 15.6

Netincome(loss)attributabletoCBI-comparablebasis,CanopyEIE(Non-GAAP) $ (27.1) $ (38.8)

ThreeMonthsEnded

May31,2020

May31,2019

EPS-reportedbasis,CanopyEIE(GAAP) $ (1.93) $ (0.42)

ComparableAdjustments-CanopyEIE(Non-GAAP) 1.74 0.20

EPS-comparablebasis,CanopyEIE(Non-GAAP)(4) $ (0.14) $ (0.20)

ThreeMonthsEnded

May31,2020 May31,2019

Income(loss)beforeincome

taxes

(Provisionfor)benefitfromincometaxes(3)

Effectivetaxrate(6)

Income(loss)beforeincome

taxes

(Provisionfor)benefitfromincometaxes(3)

Effectivetaxrate(6)

Reportedbasis(GAAP) $ (68.2) $ (104.4) (153.1)% (422.5) 185.4 43.9%

ComparableAdjustments-(Non-GAAP) 631.5 (5.9) 954.1 (278.9)

Comparablebasis(Non-GAAP) 563.3 (110.3) 19.6% $ 531.6 $ (93.5) 17.6%

Comparablebasis,CanopyEIE(Non-GAAP) (31.7) 4.6 (54.4) 15.6

Comparablebasis,excludingCanopyEIE(Non-GAAP) $ 595.0 $ (114.9) 19.3% $ 586.0 $ (109.1) 18.6%

ThreeMonthsEnded

May31,2020

May31,2019

EPS-comparablebasis(Non-GAAP)(5) $ 2.30 $ 2.21

Comparablebasis,CanopyEIE(Non-GAAP) (0.14) (0.20)

EPS-comparablebasis,excludingCanopyEIE(Non-GAAP)(4) $ 2.44 $ 2.40

(1) Equityearnings(losses)andrelatedactivitiesareincludedinincome(loss)fromunconsolidatedinvestments.(2) ComparableAdjustments,CanopyEIEinclude:restructuringandotherstrategicbusinessdevelopmentcosts,unrealized

net(gain)lossfromthemarktofairvalueofsecuritiesmeasuredatfairvalueandrelatedactivities,flowthroughofinventorystep-up,share-basedcompensationexpenserelatedtoacquisitionmilestones,acquisitioncosts,lossondilutionduetoCanopy’sissuanceofadditionalstock,andother(gains)losses.


(3) TheComparableAdjustmenteffectivetaxrateappliedtoeachComparableAdjustmentamountisgenerallybaseduponthejurisdictioninwhichtheadjustmentwasrecognized.Thebenefitfromincometaxeseffectivetaxrateappliedtoourequityinearnings(losses)ofCanopyisgenerallybasedonthetaxratesofthelegalentitiesthatholdourinvestment.

(4) Maynotsumduetoroundingaseachitemiscomputedindependently.Thecomparableadjustmentsandcomparablebasisdilutednetincomepersharearecalculatedonafullydilutivebasis.

(5) Seereconciliationoftheapplicablenon-GAAPfinancialmeasuresonpage12.(6) EffectivetaxrateisnotconsideredaGAAPfinancialmeasure,forpurposesofthisreconciliation,wederivedthereported

GAAPmeasurebasedonGAAPresults,whichservesasthebasisforthereconciliationtothecomparablenon-GAAPfinancialmeasure.

FreeCashFlowFreecashflow,asdefinedinthereconciliationbelow,isconsideredaliquiditymeasureandisconsideredtoprovideusefulinformationtoinvestorsabouttheamountofcashgenerated,whichcanthenbeused,afterrequireddebtserviceanddividendpayments,forothergeneralcorporatepurposes.Alimitationoffreecashflowisthatitdoesnotrepresentthetotalincreaseordecreaseinthecashbalancefortheperiod.Freecashflowshouldbeconsideredinadditionto,notasasubstitutefor,orsuperiorto,cashflowfromoperatingactivitiespreparedinaccordancewithGAAP.

ThreeMonthsEnded

May31,2020

May31,2019

Netcashprovidedbyoperatingactivities(GAAP) $ 686.5 $ 593.1

Purchasesofproperty,plant,andequipment (144.2) (155.7)

Freecashflow(Non-GAAP) $ 542.3 $ 437.4


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