Emerging markets growth lifts Brown-Forman’s Q1 results

American spirit firm Brown-Forman Corp reported a 9% sales growth for the first quarter ended 31 July 2018. Revenue rose to $723m from $661m in the previous year.

The company credits its success to continued improvement in emerging markets, driven by improving consumer demand in a more stable exchange rate environment. The company’s two largest emerging markets, Mexico and Poland reported double-digit gains of 27%, fueled by strong growth of its Jack Daniel’s family of brands.

Other emerging markets fared equally well, posting double-digit gains.

In the United States, the company’s biggest developed market, sales climbed 10%, driven by sustained gains of the firm’s bourbon brands including Jack Daniel’s family of brands, Woodford Reserve and Old forester.

Other developed markets outside the U.S. recorded 2% growth, except for Australia which saw a one-off 12% lift, helped by buy-ins in advance of excise tax driven price increases.

Other markets such as the United Kingdom and Germany saw sales declines due to timing. Brown-Forman said it expects this to normalize in the second quarter.

First quarter net profit rose 24% to $178m, from $144m in the same period a year ago.

The company said it was sticking with its full-year guidance of 4 – 5% underlying net sales growth and 6 – 8% underlying operating income growth.

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