CONSTELLATION BRANDS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (in thousands, except share data) Accumulated  Additional Other Preferred  Common Stock  Paid-in  Retained Comprehensive  Treasury  Unearned Stock  Class A Class B  Capital  Earnings  Loss  Stock Compensation  Total  BALANCE, February 28, 2001  $  –  $ 749  $ 148 $ 267,206 $ 455,798  $ (26,004) $ (81,478) $  (151) $  616,268 Comprehensive income:  Net income for Fiscal 2002  – – – – 136,421  – – – 136,421  Other comprehensive (loss) income, net of tax:  Foreign currency translation adjustments  – – – –  – (9,239) – – (9,239) Unrealized gain on cash flow hedges:  Net derivative gains, net of tax effect of $105  – – – – – 212  – – 212  Reclassification adjustments, net of tax effect of $92  – – – – – (191) – – (191) Unrealized gain on cash flow hedges  21  Other comprehensive loss, net of tax  (9,218) Comprehensive income 127,203  Conversion of 196,798 Class B Convertible Common  shares to Class A Common shares  – 2  (2) – – – – – – Exercise of 4,234,440 Class A stock options  – 42  – 45,602  – – – – 45,644 Employee stock purchases of 120,674 treasury shares  – – – 639  – – 1,347  – 1,986  Amortization of unearned restricted stock compensation  – – – – – – – 101  101  Issuance of 9,385,000 treasury shares, net of fees  – – – 104,714  – – 46,765  – 151,479  Tax benefit on Class A stock options exercised  – – – 12,836  – – – – 12,836  Tax benefit on disposition of employee stock purchases  – – – 65  – – – – 65  Other  – – – 154  – – – – 154  BALANCE, February 28, 2002  – 793  146  431,216  592,219  (35,222) (33,366) (50) 955,736  Comprehensive income:  Net income for Fiscal 2003  – – – – 203,306  – – – 203,306  Other comprehensive (loss) income, net of tax:  Foreign currency translation adjustments  – – – – – 18,521  – –  18,521 Reclassification adjustments for net derivative  gains, net of tax effect of $13  – – – – – (21)  – –  (21) Minimum pension liability adjustment, net of tax  effect of $18,681  – – – – – (42,535)  – –  (42,535) Other comprehensive loss, net of tax  (24,035) Comprehensive income 179,271  Conversion of 29,900 Class B Convertible Common  shares to Class A Common shares  – – – – – – – – – Exercise of 2,096,061 Class A stock options  – 21  – 28,148  – – – – 28,169 Employee stock purchases of 139,062 treasury shares  – – – 1,410  – – 1,475  – 2,885  Issuance of 7,080 restricted Class A Common shares  – – – 127  – – 74  (201) – Amortization of unearned restricted stock compensation  – – – – – – – 100  100  Tax benefit on Class A stock options exercised  – – – 8,440  – – – – 8,440  Tax benefit on disposition of employee stock purchases  – – – 74  – – – – 74  Other – – – 309 – – – – 309 BALANCE, February 28, 2003  – 814  146  469,724  795,525  (59,257) (31,817) (151) 1,174,984  Comprehensive income:  Net income for Fiscal 2004  – – – – 220,414  – – – 220,414  Other comprehensive income (loss), net of tax:  Foreign currency translation adjustments, net of tax  effect of $6,254  – – – – – 410,694  – – 410,694  Unrealized gain on cash flow hedges:  Net derivative gains, net of tax effect of $15,714  – – – – – 38,199  – – 38,199  Reclassification adjustments, net of tax effect of $507  – – – – – (1,250) – – (1,250) Unrealized gain on cash flow hedges  36,949  Unrealized loss on marketable equity securities, net  of tax effect of $185  – – – – – (432) – – (432) Minimum pension liability adjustment, net of tax  effect of $6,888  – – – – – (15,652) – – (15,652) Other comprehensive income, net of tax  431,559  Comprehensive income 651,973  Conversion of 13,860 Class B Convertible Common  shares to Class A Common shares  – – – – – – – – – Exercise of 2,612,311 Class A stock options  – 26  – 36,209  – – – – 36,235  Employee stock purchases of 165,776 treasury shares  – – – 1,658  – – 1,824  – 3,482 Issuance of 9,800,000 Class A Common Shares  – 98  – 261,118  – – – – 261,216  Issuance of 170,500 Preferred Shares  2  – – 164,868  – – – – 164,870  Dividend on Preferred Shares  – – – – (5,746) – – – (5,746) Issuance of 3,288,913 Class A Common Shares  in connection with Hardy Acquisition  – 33  – 77,210  – – – – 77,243 Amortization of unearned restricted stock compensation  – – – – – – – 101  101  Tax benefit on Class A stock options exercised  – – – 13,029  – – – – 13,029  Tax benefit on disposition of employee stock purchases  – – – 82  – – – – 82  Other – – – 150 – – – – 150 BALANCE, February 29, 2004  $ 2  $ 971  $ 146  $ 1,024,048  $ 1,010,193  $ 372,302  $ (29,993) $ (50) $ 2,377,619  The accompanying notes to consolidated financial statements are an integral part of these statements. 41