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Greetings, and welcome to the Constellation Brands’ Fourth Quarter and Full Year 2023 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the call over to, Joe Suarez, Vice President of Investor Relations. Thank you. You may begin.

Thank you, Darryl. Good morning, all, and welcome to Constellation Brands year-end fiscal 2023 conference call. I’m here this morning with our Bill Newlands, our CEO; and Garth Hankinson, our CFO. As a reminder, reconciliations between the most directly comparable GAAP measures and any non-GAAP financial measures discussed on this call are included in our news release or otherwise available on the Company’s website at www.cbrands.com. Please refer to the news release and Constellation’s SEC filings for risk factors, which may impact forward-looking statements made on this call. Following the call, we will also be making available in the Investors section of our company’s website a series of slides with key highlights of the prepared remarks shared by Bill and Garth in today’s call. Before turning the call over to Bill, in line with prior quarters, I would like to ask that, we limit everyone to one question per person, which will help us end our call on-time. Thanks in advance. And now, here is Bill.

Thank you, Joe, and good morning, everyone. I’m pleased to report that our team delivered another solid year of performance in fiscal ‘23, driving a 7% increase in net sales and a 3% increase in comparable operating income, despite elevated inflationary headwinds faced throughout the year. We delivered record net sales and comparable operating income of $9.5 billion and $3 billion, respectively. We were recognized as the number one growth leader among large CPG companies by IRI and Boston Consulting Group in calendar year ‘22. And we’re the only CPG company of scale in recent times to make their top 10 ranking for 10 consecutive years. Our performance was driven by strong execution of our strategy, which centers on continuing to build powerful brands that people love; to introduce consumer led innovations that address emerging trends and consistently shape our portfolio for profitable growth; to deploy capital with discipline, while balancing priorities; and operate in a way that is both good for business and good for the world. Here’s how each of our segments delivered against each of these objectives in fiscal ‘23. Our Beer Business delivered another year of double-digit net sales growth, and its 13th consecutive year of shipment volume growth, while maintaining best-in-class margins. We extended our lead as the number one high end beer supplier in the U.S. and as the leading share gainer in IRI channels with a 12% increase in dollar sales. We increased depletions by nearly 27 million cases, and delivered net sales and operating income growth well above the initial top end of our guidance range. We continue to build momentum for our anchor brands. Modelo Especial maintained its position as the top share gainer and the number one high-end beer brand in the category, increasing depletions by 9%; Corona Extra was the third largest share gainer and the number three high-end beer brand in the category, increasing depletions by nearly 4%; and Pacifico gained significant momentum as a top 10 share gainer in tracked channels, delivering depletion growth of over 30%. Several consumer-led innovations within our Modelo Chelada franchise served as growth catalysts in fiscal ‘23. Our Naranja Picosa flavor, a new variety pack, added over 1.6 million new cases of depletions to our Chelada brands. Our new Limón y Sal 12-ounce, 12-pack helped to more than double the depletions of that flavor to over 5.6 million cases. And in tracked channels, the Limón y Sal 12-pack was a top 15 new package SKU and a variety pack of top 10 new brands. We continue to invest in our beer business, deploying over $800 million in capital investments in fiscal ‘23, which supported the ongoing expansions of our growing capacity at Obregon, the continued development of our new ABA alcohol production line at Nava and the early stage work at our new site in Veracruz. As part of our commitment to water stewardship, we recently worked with local efficients and water authorities to complete a project that updated water infrastructure in the city of

Thank you, Bill, and good morning, everyone. Fiscal ‘23 was another solid year for our company as we continued to relentlessly deliver on our operating plans and strategic initiatives. Despite the inflationary pressures that both our industry and consumers have been facing, we demonstrated yet again the strength of our adaptable businesses, higher end brands and resilient teams. We expect the same focus and dedication to further support our momentum in fiscal ‘24. So, let’s review in more detail our full year fiscal ‘23 performance and fiscal ‘24 outlook. As always, I will focus on comparable basis financial results. Starting with the fiscal ‘23 performance of our beer business. Net sales increased $713 million or 11%, exceeding the upper end of our guidance range. This was primarily driven by solid shipment growth of approximately 7% as strong demand continued across our portfolio, supporting a $464 million uplift in net sales from incremental volumes. Net sales also benefited from favorable pricing in excess of our unusual 1% to 2% average annual pricing algorithm. As we previously noted, the incremental pricing actions taken in fiscal ‘23 were in response to cost pressures across the value chain due to inflationary headwinds. We introduced larger pricing increases and made pricing adjustments in certain markets ahead of our regular case. Depletion growth for the year was over 7%, which, as Bill noted, was driven by continued strong growth in our largest brands, Modelo Especial, Corona Extra, Pacifico and Modelo Chelada brands. On-premise depletions grew 15% year-over-year, and on-premise volume accounted for approximately 12% of total depletions in fiscal ‘23, nearing the mid-teen volume share from prior to the start of pandemic. As previously guided, our shipments and depletions were closely aligned on an absolute basis. Moving on to the bottom line for our beer business. Operating income increased 6%, also exceeding the upper end of our guidance range. This increase was largely driven by a $492 million benefit from net sales growth and yielded an operating margin of 38.3%, which was in line with our implied guidance range. As expected and noted over fiscal ‘23, operating margins were negatively affected by inflationary headwinds. For the import portion of our beer business, which represents nearly the entirety of COGS, we faced an increase of approximately 16% in our raw materials and packaging costs, which was largely driven by inflationary pressures that resulted in an 8% increase on a per case basis. This reflected some benefits from the lapping of the seltzer obsolescence charge in fiscal ‘22 as excluding any obsolescence impact, the increases in our raw materials and packaging costs would have been 20% on an absolute basis and 12% on a per case basis. Note that these two COGS categories, including the obsolescence impact represented just over 55% of the import portion’s COGS in fiscal ‘23. We also saw a 12% year-over-year increase in freight costs, mainly driven by incremental shipment expenses that were offset by efficiency initiatives. Freight costs were 5% up on a per case basis and account for just under 25% of import. And we faced a 14% rise in labor and overhead costs that was mainly driven by our brewery capacity investments. Labor and overhead were up 7% on a per case basis and accounted for just under 15% of import COGS. In addition, operating margins for the beer business were also affected by a $41 million or nearly 22% increase in depreciation, almost entirely associated with our brewery capacity investments. A $55 million or nearly 9% increase in marketing spend related to incremental investments in sports sponsorships and a $48 million or nearly 14% increase in our -- in other SG&A, driven by incremental sales support to align with the momentum of our beer brands. Note, however, that while our marketing investments increased when compared to the prior year, they were still within our 9% to 10% range as a percentage of net sales. All of that said, and it’s important to note that we still delivered best-in-class margins for our beer business in fiscal ‘23. Now shifting to our Wine and Spirits business. First, please recall that we divested a collection of primarily mainstream wine brands from our wine portfolio in fiscal ‘23. So during today’s remarks, I will also be discussing top line on an organic basis, which excludes the contributions from the divested brands. As Bill noted, despite the strong performance of our higher-end Wine and Spirits brands on an organic basis, net sales decline of 2%, ultimately landing in our guidance range. The decline in net sales, excluding the impact of the divestiture, was primarily driven by our mainstream brands as they faced challenging market conditions and lapping of prior fiscal year inventory build. Again, this decline was partially offset by strong growth in our higher-end brands, which outperformed in the U.S. in the higher-end category for both Wine and Spirits and total U.S. wine market. Our higher-end brands also had strong growth in our emerging and rapidly expanding direct-to-consumer channels and international markets. Over time, we expect our portfolio to continue to migrate toward the higher end and for these higher-end brands, channels and markets to support our top line growth acceleration. Shipments on an organic basis decreased by under 8% and depletions decreased by 3%. As just noted, this volume decline, which reduced organic net sales by $148 million, was driven primarily by our mainstream brands, as mix and price, largely driven by our higher-end brands provided a $111 million uplift to organic net sales. Wine and Spirits operating income, excluding the gross profit, less marketing of the brands that are no longer part of the business, following their divestiture in fiscal ‘23, increased 2%, and operating margin increased 80 basis points to nearly 23%, also reflecting the same exclusion. This margin increase was driven by a $12 million uplift from net sales flow-through as favorable product mix was supported by lower grade costs as well as a strong New

Our first question comes from the line of Andrea Teixeira with JPMorgan.

Thank you. Good morning. Can you comment on what you’re seeing most recently and that makes you feel confident about the 7% to 9%, your sales growth outlook and particularly in light of the broad deceleration in consumption called out by retailers in March? And related to that, are there any dynamics between shipments ahead of the Cinco de Mayo, start of the summer and the depletions as we move into the first quarter and throughout the year? And if I can squeeze on the pricing front, you mentioned the 1% to 2%, but I understand some of the competitors decided to just pushback. And given the dynamics that you had towards the fall last year, if you’re going to be mostly looking to do pricing for the fall? Thank you.

Sure. Thanks for the question, and good morning to you. A couple of things that give us the confidence in the 7% to 9% range. First of all, we saw a very strong start to the year in markets like Texas and Florida, which have both seen double-digit increases in the first month of the year. Now acknowledging the state of California has been challenging, but I’ll tell you what I’m very excited about, about California. In Q4, we saw our distribution growth, our effective distribution grew by 3.6%, Q4 versus the Q4 prior, or simple distribution despite a very broad market capability there, saw a simple distribution grow up 2%. And our draft panels went up over 9%. What this says to me is that we are well prepared when California gets back into their normal weather pattern versus what we saw this year. So, we’re very comfortable. Obviously, we wouldn’t be giving you this guidance if we thought otherwise. But we feel very comfortable that we’ll be in that 7% to 9% range that we noted today. Garth, do you want to touch on the pricing point?

Yes. So I mean, as we stated in our prepared remarks, we’re comfortable with the pricing at our 1% to 2% algorithm. Obviously, we will continue -- our approach to pricing gives us the flexibility throughout the year to monitor what’s the macroeconomic and the inflationary recession impacts -- potential recession impacts are on our consumer. It allows us to monitor competitor behavior and give us the flexibility to act agilely when we see a reason to move on price. So that will be something that I said in my prepared remarks that to the extent we make any changes throughout the year, we will provide updates on our regular quarterly calls.

Our next question comes from the line of Kevin Grundy with Jefferies.

Just a quick cleanup. Bill, I’m not sure if you can comment on March depletion trends. I mean, presumably, given the importance of California, I suspect it’s probably running a bit below what we saw in the fourth quarter. Maybe you could just comment on that. But my broader question is on the Oro launch, and maybe just follow-up there on your expectations, comments on cannibalization risk. And then I think importantly, sort of context around how we should be thinking about this rollout relative to the premier launch several years ago and the degree of incremental spend? If I’m not mistaken, Garth, you can correct me if I’m wrong, I think that was in the $35 million to $40 million range of incremental spend behind that rollout, but just some context around there would be helpful. So, thank you both for that. I appreciate it.

Sure. So that I don’t step on myself after I just got done saying at CAGNY that I wasn’t going to talk about depletions anymore, I won’t specifically talk about March depletions other than to say they’re pretty much in line with what we expected. As I did note in my prior answer to Andrea, Texas, Florida were up double digits. Certainly, California was challenged this particular start to the year. But I think it’s safe to say that as we progress in the year, it’s extremely unusual to have rain, snow or flooding, once you get into May, June, July and August in the state of California. So much like we’ve seen many other times when there’s a dislocation of particular market, we expect that that would pass over time. Second, related to your Oro question, we’ve said we’re going to be very sensible about the rollout of Oro. I’m pleased to say that our beer group has done an extremely good job of getting distribution into the marketplace. As you know, we’re less than a month in on that particular project. But we were very positive about the cannibalization rates that we saw in the 3 test markets. We saw incrementality above 60% in those markets, which we are very pleased with. And we really think it fills a gap, particularly with our core Hispanic consumer, who has been looking for an alternative to some of the other light beer scenarios. So, we’re very positive about that, but we’re going to do it in a very sensible and approachable way. For those of you who watched March Madness, you would have noted, we had -- we started our media campaign during that particular event. And this launch will be supported by significant media over the course of the summer.

Our next question comes from the line of Dara Mohsenian with Morgan Stanley.

On the beer depletion side, can you discuss a bit the trends you’re seeing on-premise? The gap looked better in terms of on-premise and some of the smaller store on track channels relative to track channels versus Q2 and Q3. So just would love to get an update there. And then, also do you think you’re seeing any broader macro impacts in your portfolio? Maybe give us a bit of update on trade down in general in beer and what’s occurring there and any impacts to your business? Thanks.

You bet. So in terms of on-premise, on-premise continues to grow, as we noted in our prepared remarks. We continue to see acceleration in the on-premise, which we think is very good. We’re not quite back to where we were from a normal standpoint that where we sat before the pandemic, but we continue to make progress against that as we are seeing more and more often that consumers are being out in the marketplace and consuming on-premise. So, we remain optimistic. Our growth profile in the on-premise really continues to accelerate. As I think many on-premise accounts are looking more and more for brands that resonate consistently with consumers. And obviously, we have those and that speaks very well. I used the example of a well saturated market like California seeing draft panels on our business were up 9% in the fourth quarter last year. And I think that’s a great reflection of the potential that still exists for us in the on-premise. Relative to your question about trade down, we have seen very little trade down against our portfolio. Certainly, there has been some, it appears, but it tends to occur at lower price points than ours. So there are some consumers that are showing some concern about general inflationary macroeconomic trends. But by and large, that has occurred at lower price points that where our brands compete. And that’s fairly consistent with what we’ve seen relative to the pure loyalty we see against our brands. It’s the benefit of having consumer preferred brands in our portfolio.

Our next question comes from the line of Rob Ottenstein with Evercore.

Just a follow-up on Garth on some of your guidance comments, and I don’t know if I -- just maybe I didn’t follow you. But I think you were talking about productivity measures that would help get to the margin target. And then you talked kind of very quickly or with some points on hedging programs and the amount hedged or not -- and I just -- I apologize, I lost you on that. But I was kind of trying to connect what hedging would have to do with productivity and trying to exactly the point you were trying to make.

Yes. So sure, Robert, thanks for the question. And just so as Joe indicated at the beginning of the remarks, we are going to be posting some slides to our website immediately following this call specific to the efficiency -- productivity efficiencies and the hedging. The point on that is it’s just like in any given year, we have certain productivity goals, efficiency goals, savings to help offset the impact of cost increases related to inflation. So, that’s no different than any other year. And the point of the comment was that those increases that I had stated previously, those are net of those efficiencies. And then on the point around hedging is just that we continue to have a fairly robust hedging policy program. Typically, we are only able to hedge around 10% to 15% of what’s in our cost of goods. And so, we are hedging against those things right now. And as we enter this year, we’re at where we would normally be in terms of the percent of commodities that are hedged.

Our next question comes from the line of Nik Modi with RBC Capital Markets.

Just a few follow-ups. So -- just curious on -- Bill, you mentioned some of the distribution gains you’ve seen in California. Just was hoping to get some context on your view on resets and kind of what you’re seeing more broadly, especially in the markets where you’re undershared relative to where you are in California? And then the second question is just there’s been a lot of discussion in the trade about some of the other brewers perhaps rolling back some pricing or promoting back some of the recent price increases. Just wanted to get some context on kind of philosophically how you think about if that were to happen, kind of would you need to react or not? And just would love your context and perspective on that.

Yes. You bet, Nik. Thanks for the question. One of the things that relative to resets, we are doing extremely well in reset situations. And I think it’s just simple, good business because with our portfolio representing more than 80% of the growth in the total beer category, it just makes sense for retailers to increase our shelf positions versus the competition. You see, as we said in our prepared remarks, Modelo being the number 1 growth driver and Corona being the number 3 growth driver and Pacifico being the top 10 growth driver, these brands demand more space on the shelf. And we’re very fortunate that our team is specifically focused on that very topic. Relative to pricing, as Garth noted, we carefully analyze the elasticities against our brands, and I’ve said this on many other occasions, we’re very mindful that we want to keep our consumer. And our pricing strategies over time have been to be sensible and approachable to ensure that we keep our consumers. We’re going to raise within our normal algorithm this year in the 1% to 2%, as Garth noted, but we should then expect no rolling back of any pricing scenarios from us this year because we have been judicious and sensible about keeping the consumer engaged with us as we move pricing in the past. We’ll continue to monitor to that carefully as the year goes on, as we always do. On a monthly basis, we analyze elasticities and drivers and drags, which you’ve all heard from Jim Sabia over time. But we see absolutely no need to be rolling back pricing in any market because we think we were very appropriate in what we have done historically, which should allow us to be right back in our algorithm going forward.

Our next question comes from the line of Bonnie Herzog with Goldman Sachs.

I had a question on your free cash flow guidance of $1.2 billion to $1.3 billion this year. It’s a fair amount below your historical run rate. So maybe you could highlight the key puts and takes that are going to impact your free cash flow this year? And then, you completed your share repurchase goals to date and your $5 billion return to shareholder target, but you didn’t necessarily announce a new return goal. So, curious how you’re thinking about your capital allocation priorities going forward? And then, maybe what’s realistic to consider for cash return to shareholders this year and beyond thinking about this in the context of the CapEx needs, your leverage targets, et cetera? Thanks.

Thanks, Bonnie. So, to start on free cash flow. I guess to start on free cash flow, we need to start at operating cash flow, right? So operating cash flow is a bit down this year versus last year. And the primary drivers of that are really a couple fold. One is there is the increase in interest that I referenced in my opening remarks pretty much at 25% increase on a year-over-year basis, and that’s really reflective primarily of the debt and the interest associated with the collapse, and then to a lesser extent, the remaining floating rate debt that we have on our books. Additionally, we’ll have higher cash paid taxes next year due to the U.S. -- and some nonrecurring tax benefits that we had in FY23 and then to a smaller extent some changes in working capital. Moving further down the list. We’ll continue to have significant investments in CapEx, as you heard. And so, that’s really -- those are the factors that are driving the free cash -- the operating cash flow and free cash flow ranges that we outlined earlier. As it relates to the share returns of capital to shareholders through share repurchases. We still have nearly $1 billion left under our existing Board authorization for share repurchases. As we mentioned in our comments, at the very least, we will buy back throughout the year, but we will continue to be agile and be able to take advantage of market conditions, just like we did in Q4, where, as Bill noted in his remarks, we aggressively bought back almost $300 million worth of shares as we saw some -- what we consider dislocations in price. So, that’s going to -- that will be how we continue throughout the year. We actually like the ability to have that flexibility. And so, it’s something that will obviously continue to be a very critical component of our capital allocation strategy.

Our next question comes from the line of Peter Grom with UBS.

So I wanted to ask about the pricing cadence and the commentary that you’re going to be monitoring the health of the consumer. And you provided a lot of color in the response to both Andrea and Nik’s question. But I guess if you don’t plan to roll back prices, can you maybe just talk about what actions you would be willing to take if the environment were to deteriorate, would that just be pricing at the lower end? And I guess what I’m really trying to understand is if the pricing outlook were to really change at all, how would that impact your ability to achieve your margin targets? Could you lean in more elsewhere, or would it be more difficult to achieve?

Well, there’s a lot of negative what ifs in the question, which, frankly, we don’t see coming to pass. If you look historically what our beer business has been able to accomplish, we have maintained a very consistent approach to pricing over time, 1% to 2% year after year after year. The last couple of years, as you know, we’ve significantly gone beyond that in an effort to hedge against some of the strong inflationary pressures that all consumer companies have faced. Our belief is we are in a very good position to do our historical 1% to 2% pricing increase. That’s based on a lot of analytics and a lot of elasticity assessments that we do on an ongoing basis. We are very comfortable with that, and we feel like that’s going to be an appropriate play for the course of this fiscal year, which should allow us to do everything we said. I would also note, just as an adjunct to that, one of the things that I said at CAGNY was how strong the Modelo share was in its two strongest markets, which was California and Nevada, where we were double digit. I’m pleased to report that at this point that actually is now in four states, which includes both New Jersey and Texas, which again just continues to show that our growth profile outside of the state of California, it remains a tremendous growth opportunity for our business over the long term and also helps to support what we just talked about relative to our ability to price within our 1% to 2% algorithm.

Our next question comes from the line of Chris Carey with Wells Fargo.

So just two quick ones for me. On the -- Garth, on the beer margin outlook, you gave a lot of great detail. I guess, you’re looking for flat operating margins for the year. Is there any way -- or flattish. Is there any way to frame expectations for gross margin relative to operating margin? And I say that in the context of productivity initiatives, which I suppose can play out in both line items. So I was just curious if you have any comment there. The second observation is Wine and Spirits just delivered what I think is the best operating margin in a few years. And yet the outlook would imply that you’re giving a lot of that back. So is that just conservatism, or is there something just missing in the bridge about some of this nice premiumization, which has really helped the margin structure there? And I sort of asked that in the context of prior margin targets for the Wine and Spirits business in general. So, thanks for those two on Beer margins and Wine and Spirits margins.

Yes. So, on the Wine and Spirits margins -- and so again, I’ll reference you to the deck that will be posted to our website after this call. But we’re actually forecasting wine margins to increase by at least 40 basis points on a year-over-year basis. And so, you’ll be able to see that detail on the website. As it relates to operating margin -- or gross profit margin with beer, I mean, all of the headwinds that we’re facing really in beer this coming year will be in gross margin and not below the line. As we said, we’ll continue to -- we’ll continue to effectively manage our marketing and SG&A spend and focus on the highest return and highest priority initiatives, and we’ll manage that effectively. So, the largest drag for us, as we’ve said for the last several months now, it’s going to just be the inflationary impact. Again, we’ll hit through COGS as well as some incremental depreciation throughout the year.

Our next question comes from the line of Nadine Sarwat with Bernstein.

So just coming back to the beer margin point, if I take the midpoint up your beer guidance for top line and operating income, it comes a touch below your initial 38 that I think you discussed. Was there anything in particular that changed to the downside versus your previous commentary, or I mean, is this just a situation of rounding here? And then just a follow-up on the margin point, given the margins of last year and what we’ll be seeing on the back of your guidance for this fiscal year. Should we still be thinking about 39% to 40% as your medium-term margin for the business? And would it be fair to [Technical Difficulty] 25?

So, we do apologize because you broke there at the end…

I think the back end of that was do we expect to get there in fiscal ‘25. You broke up, I apologize, but I think that’s what said. So go ahead.

Yes. So I think as you’re working with the numbers that we provided, when we said 38% operating -- approximately 38% operating margin. So that if you kind of look at the various points within our range, you’ll come up with various different outputs as it relates to what the margin will be. So we fully -- we have full conviction that we’re going to deliver operating margins for our beer business on approximately 38%. As it relates to the outlook going forward, we’ve just provided our outlook -- our margin outlook for our beer business for FY24. We’re not providing any guidance for future years. We typically don’t do that at this point. That’s not part of our process. Certainly, the biggest driver again this year that we have for FY24 is again driven predominantly by inflation and the inflation that we’re seeing, which I outlined in my scripts as well as some incremental depreciation. Offsetting that, we’ll continue to take pricing as we have. And as we’ve said earlier, we’ll be -- pricing in our 1% to 2% range. We continue to drive incremental volume, which helps to offset fixed overheads and depreciation as we grow into our expanded footprint, and we’ll continue on with the efficiency drivers that I mentioned as well. So, that’s where we stand for FY24, and we’ll talk about FY25 as we -- closer to the end of the year.

Thank you. Our final question comes from the line of Bryan Spillane with Bank of America.

I wanted to touch -- just move back to Wine and Spirits. And maybe Garth, could you talk a little bit about how and SVEDKA and Woodbridge are affecting margin and maybe margin progression there? And I guess I ask in the context of they’re a much larger contributor to volume than they are to revenue. And I guess my assumption is the margins are lower than the average. So just trying to understand, is getting volume stabilization or volume growth in those 2 brands an important component sort of building margins there, or is that not really a big factor? So, really just trying to understand Woodbridge and SVEDKA and kind of the longer-term impact on profitability in Wine and Spirits?

Yes. Well, you’re absolutely correct that given the size of those brands that they do have a bit of a drag on our overall margin profile, given the price points in which they compete and therefore, their margin profile, which is below the average profile for the entire business unit. On a positive note, the Wine and Spirits team has pretty aggressive revitalization plans in place for both of those brands so that we can stabilize those brands and continue to outperform the price segments that they participate in. And as such, as we continue to make those efficiency improvements, we certainly -- and revitalize those brands, we expect that we’ll be able to achieve our margin targets as laid out.

Thank you. We have reached the end of our question-and-answer session. I would now like to turn the call back over to Bill Newlands for closing remarks.

Thanks very much. Fiscal ‘23 was a big year for Constellation Brands. We achieved record net sales and comparable operating income and were recognized for the tenth year as a CPG growth leader, despite some of the most significant inflationary headwinds affecting our company and consumers in recent history. Our beer business outperformed our initial expectations and continued to lead in share gains, growth and margins. Despite some volatility across the year as we lapped distortions in our performance from prior periods and navigating incremental pricing actions beyond our annual algorithm intended to offset cost pressures across the chain. And we delivered many other transformational milestones, including our transition to a single share class structure and other important corporate governance enhancements. The start of our construction activities at our new brewery site in Veracruz, and some additional refinement of our Wine and Spirits portfolio as well as continued progress against the strategy of that business. Lastly, the performance of our business, coupled with our disciplined and balanced capital allocation priorities allowed us to maintain our investment-grade rating, despite the incremental financing associated with the transaction for our transition to a single share price structure to surpass our share repurchases and dividend cash returns goal by over 400 million and continuing to grow our beer production capacity while executing small growth accretive M&A. As we look forward to fiscal ‘24, we remain focused on delivering sustainable growth and value creation for our shareholders through the execution of our annual plan and by continuing to advance our strategic initiatives. And we are confident in our ability to continue building momentum across our bigger portfolio and strong volume growth and targeted pricing actions. We are bullish on the future performance of our Wine and Spirits business as it continues to advance its strategy, and we are committed to our capital allocation priorities and our ESG efforts. Thanks again, everyone, for joining the call. We hope you will choose to enjoy your Cinco de Mayo and Memorial Day celebrations with some of our great products, and we look forward to speaking with all of you in late June on our next quarterly call. Thank you very much, and have a great day.