Goodwill and Intangible Asset Disclosure
Adjustments to Financial Statements: Removal of Goodwill
Adjusted Financial Ratios: Removal of Goodwill (Summary)
Adjusted Total Asset Turnover
Adjusted Financial Leverage
Adjusted Return on Equity (ROE)
Adjusted Return on Assets (ROA)

Constellation Brands Inc., balance sheet: goodwill and intangible assets

US$ in thousands

	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020	Feb 28, 2019	Feb 28, 2018	Feb 28, 2017
Goodwill	7,862,400)	7,793,500)	7,757,100)	8,088,800)	8,083,100)	7,920,500)
Customer relationships	87,100)	87,200)	87,400)	89,900)	89,800)	89,100)
Other	20,900)	21,100)	20,200)	20,500)	20,300)	19,900)
Amortizable intangible assets, gross carrying amount	108,000)	108,300)	107,600)	110,400)	110,100)	109,000)
Accumulated amortization	(86,300)	(81,800)	(75,500)	(70,400)	(64,500)	(58,700)
Amortizable intangible assets, net carrying amount	21,700)	26,500)	32,100)	40,000)	45,600)	50,300)
Trademarks	2,733,500)	2,705,600)	2,686,800)	3,158,100)	3,259,200)	3,327,400)
Nonamortizable intangible assets	2,733,500)	2,705,600)	2,686,800)	3,158,100)	3,259,200)	3,327,400)
Intangible assets	2,755,200)	2,732,100)	2,718,900)	3,198,100)	3,304,800)	3,377,700)
Goodwill and intangible assets	10,617,600)	10,525,600)	10,476,000)	11,286,900)	11,387,900)	11,298,200)

Based on: 10-K (reporting date: 2022-02-28), 10-K (reporting date: 2021-02-28), 10-K (reporting date: 2020-02-29), 10-K (reporting date: 2019-02-28), 10-K (reporting date: 2018-02-28), 10-K (reporting date: 2017-02-28).

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Item	Description	The company
Goodwill	Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized.	Constellation Brands Inc. goodwill increased from 2020 to 2021 and from 2021 to 2022.
Intangible assets	Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges.	Constellation Brands Inc. intangible assets increased from 2020 to 2021 and from 2021 to 2022.
Goodwill and intangible assets	Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges.	Constellation Brands Inc. goodwill and intangible assets increased from 2020 to 2021 and from 2021 to 2022.

Constellation Brands Inc., adjustments to financial statements

US$ in thousands

	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020	Feb 28, 2019	Feb 28, 2018	Feb 28, 2017
Adjustment to Total Assets
Total assets (as reported)	25,855,800)	27,104,800)	27,323,200)	29,231,500)	20,538,700)	18,602,400)
Less: Goodwill	7,862,400)	7,793,500)	7,757,100)	8,088,800)	8,083,100)	7,920,500)
Total assets (adjusted)	17,993,400)	19,311,300)	19,566,100)	21,142,700)	12,455,600)	10,681,900)
Adjustment to Total CBI Stockholders’ Equity
Total CBI stockholders’ equity (as reported)	11,731,900)	13,598,900)	12,131,800)	12,551,000)	8,046,100)	6,891,200)
Less: Goodwill	7,862,400)	7,793,500)	7,757,100)	8,088,800)	8,083,100)	7,920,500)
Total CBI stockholders’ equity (adjusted)	3,869,500)	5,805,400)	4,374,700)	4,462,200)	(37,000)	(1,029,300)

Based on: 10-K (reporting date: 2022-02-28), 10-K (reporting date: 2021-02-28), 10-K (reporting date: 2020-02-29), 10-K (reporting date: 2019-02-28), 10-K (reporting date: 2018-02-28), 10-K (reporting date: 2017-02-28).

Constellation Brands Inc., Financial Data: Reported vs. Adjusted

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Constellation Brands Inc., adjusted financial ratios

	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020	Feb 28, 2019	Feb 28, 2018	Feb 28, 2017
Total Asset Turnover
Reported total asset turnover	0.34	0.32	0.31	0.28	0.37	0.39
Adjusted total asset turnover	0.49	0.45	0.43	0.38	0.61	0.69
Financial Leverage
Reported financial leverage	2.20	1.99	2.25	2.33	2.55	2.70
Adjusted financial leverage	4.65	3.33	4.47	4.74	—	—
Return on Equity (ROE)
Reported ROE	-0.34%	14.69%	-0.10%	27.38%	28.82%	22.28%
Adjusted ROE	-1.04%	34.42%	-0.27%	77.00%	—	—
Return on Assets (ROA)
Reported ROA	-0.16%	7.37%	-0.04%	11.75%	11.29%	8.25%
Adjusted ROA	-0.22%	10.35%	-0.06%	16.25%	18.62%	14.37%

Based on: 10-K (reporting date: 2022-02-28), 10-K (reporting date: 2021-02-28), 10-K (reporting date: 2020-02-29), 10-K (reporting date: 2019-02-28), 10-K (reporting date: 2018-02-28), 10-K (reporting date: 2017-02-28).

Financial ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Constellation Brands Inc. adjusted total asset turnover ratio improved from 2020 to 2021 and from 2021 to 2022.
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Constellation Brands Inc. adjusted financial leverage ratio decreased from 2020 to 2021 but then increased from 2021 to 2022 exceeding 2020 level.
Adjusted ROE	A profitability ratio calculated as net income divided by adjusted shareholders’ equity.	Constellation Brands Inc. adjusted ROE improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022.
Adjusted ROA	A profitability ratio calculated as net income divided by adjusted total assets.	Constellation Brands Inc. adjusted ROA improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022.

Constellation Brands Inc., Financial Ratios: Reported vs. Adjusted

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	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020	Feb 28, 2019	Feb 28, 2018	Feb 28, 2017
As Reported
Selected Financial Data (US$ in thousands)
Net sales	8,820,700)	8,614,900)	8,343,500)	8,116,000)	7,585,000)	7,331,500)
Total assets	25,855,800)	27,104,800)	27,323,200)	29,231,500)	20,538,700)	18,602,400)
Activity Ratio
Total asset turnover¹	0.34	0.32	0.31	0.28	0.37	0.39
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Net sales	8,820,700)	8,614,900)	8,343,500)	8,116,000)	7,585,000)	7,331,500)
Adjusted total assets	17,993,400)	19,311,300)	19,566,100)	21,142,700)	12,455,600)	10,681,900)
Activity Ratio
Adjusted total asset turnover²	0.49	0.45	0.43	0.38	0.61	0.69

Based on: 10-K (reporting date: 2022-02-28), 10-K (reporting date: 2021-02-28), 10-K (reporting date: 2020-02-29), 10-K (reporting date: 2019-02-28), 10-K (reporting date: 2018-02-28), 10-K (reporting date: 2017-02-28).

2022 Calculations

¹ Total asset turnover = Net sales ÷ Total assets
= 8,820,700 ÷ 25,855,800 = 0.34

² Adjusted total asset turnover = Net sales ÷ Adjusted total assets
= 8,820,700 ÷ 17,993,400 = 0.49

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Constellation Brands Inc. adjusted total asset turnover ratio improved from 2020 to 2021 and from 2021 to 2022.

	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020	Feb 28, 2019	Feb 28, 2018	Feb 28, 2017
As Reported
Selected Financial Data (US$ in thousands)
Total assets	25,855,800)	27,104,800)	27,323,200)	29,231,500)	20,538,700)	18,602,400)
Total CBI stockholders’ equity	11,731,900)	13,598,900)	12,131,800)	12,551,000)	8,046,100)	6,891,200)
Solvency Ratio
Financial leverage¹	2.20	1.99	2.25	2.33	2.55	2.70
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted total assets	17,993,400)	19,311,300)	19,566,100)	21,142,700)	12,455,600)	10,681,900)
Adjusted total CBI stockholders’ equity	3,869,500)	5,805,400)	4,374,700)	4,462,200)	(37,000)	(1,029,300)
Solvency Ratio
Adjusted financial leverage²	4.65	3.33	4.47	4.74	—	—

Based on: 10-K (reporting date: 2022-02-28), 10-K (reporting date: 2021-02-28), 10-K (reporting date: 2020-02-29), 10-K (reporting date: 2019-02-28), 10-K (reporting date: 2018-02-28), 10-K (reporting date: 2017-02-28).

2022 Calculations

¹ Financial leverage = Total assets ÷ Total CBI stockholders’ equity
= 25,855,800 ÷ 11,731,900 = 2.20

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted total CBI stockholders’ equity
= 17,993,400 ÷ 3,869,500 = 4.65

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Solvency ratio	Description	The company
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Constellation Brands Inc. adjusted financial leverage ratio decreased from 2020 to 2021 but then increased from 2021 to 2022 exceeding 2020 level.

	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020	Feb 28, 2019	Feb 28, 2018	Feb 28, 2017
As Reported
Selected Financial Data (US$ in thousands)
Net income (loss) attributable to CBI	(40,400)	1,998,000)	(11,800)	3,435,900)	2,318,900)	1,535,100)
Total CBI stockholders’ equity	11,731,900)	13,598,900)	12,131,800)	12,551,000)	8,046,100)	6,891,200)
Profitability Ratio
ROE¹	-0.34%	14.69%	-0.10%	27.38%	28.82%	22.28%
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Net income (loss) attributable to CBI	(40,400)	1,998,000)	(11,800)	3,435,900)	2,318,900)	1,535,100)
Adjusted total CBI stockholders’ equity	3,869,500)	5,805,400)	4,374,700)	4,462,200)	(37,000)	(1,029,300)
Profitability Ratio
Adjusted ROE²	-1.04%	34.42%	-0.27%	77.00%	—	—

Based on: 10-K (reporting date: 2022-02-28), 10-K (reporting date: 2021-02-28), 10-K (reporting date: 2020-02-29), 10-K (reporting date: 2019-02-28), 10-K (reporting date: 2018-02-28), 10-K (reporting date: 2017-02-28).

2022 Calculations

¹ ROE = 100 × Net income (loss) attributable to CBI ÷ Total CBI stockholders’ equity
= 100 × -40,400 ÷ 11,731,900 = -0.34%

² Adjusted ROE = 100 × Net income (loss) attributable to CBI ÷ Adjusted total CBI stockholders’ equity
= 100 × -40,400 ÷ 3,869,500 = -1.04%

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Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as net income divided by adjusted shareholders’ equity.	Constellation Brands Inc. adjusted ROE improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022.

	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020	Feb 28, 2019	Feb 28, 2018	Feb 28, 2017
As Reported
Selected Financial Data (US$ in thousands)
Net income (loss) attributable to CBI	(40,400)	1,998,000)	(11,800)	3,435,900)	2,318,900)	1,535,100)
Total assets	25,855,800)	27,104,800)	27,323,200)	29,231,500)	20,538,700)	18,602,400)
Profitability Ratio
ROA¹	-0.16%	7.37%	-0.04%	11.75%	11.29%	8.25%
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Net income (loss) attributable to CBI	(40,400)	1,998,000)	(11,800)	3,435,900)	2,318,900)	1,535,100)
Adjusted total assets	17,993,400)	19,311,300)	19,566,100)	21,142,700)	12,455,600)	10,681,900)
Profitability Ratio
Adjusted ROA²	-0.22%	10.35%	-0.06%	16.25%	18.62%	14.37%

Based on: 10-K (reporting date: 2022-02-28), 10-K (reporting date: 2021-02-28), 10-K (reporting date: 2020-02-29), 10-K (reporting date: 2019-02-28), 10-K (reporting date: 2018-02-28), 10-K (reporting date: 2017-02-28).

2022 Calculations

¹ ROA = 100 × Net income (loss) attributable to CBI ÷ Total assets
= 100 × -40,400 ÷ 25,855,800 = -0.16%

² Adjusted ROA = 100 × Net income (loss) attributable to CBI ÷ Adjusted total assets
= 100 × -40,400 ÷ 17,993,400 = -0.22%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as net income divided by adjusted total assets.	Constellation Brands Inc. adjusted ROA improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022.

Constellation Brands Inc. (NYSE:STZ)

Analysis of Goodwill and Intangible Assets

Goodwill and Intangible Asset Disclosure

Adjustments to Financial Statements: Removal of Goodwill

Constellation Brands Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Goodwill (Summary)

Constellation Brands Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)