so you can see it but we think it will kind of confuse the financial statement reader if we saw that in comparable results every quarter. This quarter not surprisingly because of the rapid fall in fuel prices when we mark to market our diesel hedges there were losses and it was about USD 20 M for the quarter.
Brian Blaney, Bank of America
By the time those hedges get settles, at some point in the future if things don’t change, that settled hedge could that potentially drag margins at some point in the future because it is so far out of the money or?
Robert Ryder, Executive Vice President and Chief Financial Officer, Constellation Brands [NYSE: STZ]
Modelo Especial brand, including where currently you are standing from distribution stand point, your expectation of 2015 versus the level of expansion you saw in calendar 2014.
Absolutely! I am so sorry. I might have missed that last point. We will bring the gains or losses on these hedge contracts in to comparable earnings when the contracts are settled. So to your point, if diesel fuels prices don’t change this USD 20 M loss will come into comparable results and we will allocate it to individual segments based on their usage of fuel and because there is a lot more cases, the majority of our fuel hedges are for the beer segment although there are some for the wine segment as well.
Brian Blaney, Bank of America
OK. That is helpful. And just a second question related to foreign exchange. You know, dollar is strengthened relative for the peso pretty recently. I guess I am curious to know, you have some peso denominated cost, right? Both in your capital spending. I am assuming some of the labor associated with the construction on another brewery and also in the cost of good soil in the beer business. I am assuming there is some peso related cost or denominated cost in your cost to good soil. So can you talk about if the dollar continue were continuing to remain really strong to the peso or continue to strength in relative of the peso will it have kind of a positive effect in kind of both what your dollar cash cost outlays are for Nova and also will it have any impact at all on the gross profit of the beer business?
Robert Ryder, Executive Vice President and Chief Financial Officer, Constellation Brands [NYSE: STZ]
Yes. Good questions. In the beer segment, in look, in the grand scheme of things we are very much a North American business and actually very much a U.S. business and in the grand scheme of things we are a net importer, so a strong dollar will help us in the grand scheme of things. Now as you can see this quarter from a translation prospective, there is some hurt because the Canadian dollar is devaluing versus the U.S. dollar, so we translate Canadian earnings. That was about 1% hurt to our sales. On the peso specifically, our peso expose cost, as you said, Mexican labor, Ok?
Which isn’t an enormous piece of our total cost of goods sold but you know it is relatively large piece. And also as we spend capital, those capital cost by large be capitalized in pesos, so the depreciation on those will also be exposed to foreign exchange although that is not necessarily cash because it is depreciation. So net, net to strong dollar will help us versus our Mexican import cause. That also being said we do hedge our transaction currencies, so we aren’t 100% exposed to those peso cost because we will have some peso going out but net, net strong dollar versus the peso helps us.
Brian Blaney, Bank of America
Great! Thank you!
Operator
Our next question comes from the line of Dara Mohsenian, Morgan Stanley.
Dara Mohsenian, Morgan Stanley
Thanks! Good morning guys! So what are the given update on growths of the draft and K import exports of your business in the quarter? And also what you think the capitalizations level are in your business from expansion of those 2 areas worst draft as if you added it for your business?
