Brown-Forman sustains momentum as nine months sales rise 9%

Brown-Forman Corp, the US-based spirits firm behind such brands as Jack Daniel’s whiskey, Woodford Reserve and Old Forester bourbon reported its nine months results through 31 January 2018 on Wednesday, with the Louisville, Kentucky based firm posting a 9% revenue growth to $2.5bn. In the third quarter alone, sales rose 9% to $878m.

Paul Varga, Brown-Forman’s chief executive officer said, “Brown-Forman’s business momentum continued through the third quarter, resulting in year-to-date underlying net sales and operating income growth of 7% and 11%, respectively, and even stronger on a reported basis.

“The results were well-balanced by geography and driven by 8% underlying net sales growth for our Jack Daniel’s led American whiskey portfolio. Our accelerated rates of growth keep us on track to deliver high quality, top-tier results in fiscal 2018,” he said.

On a geographic basis, the company said its 7% sales growth in the US, its largest market was driven by broad-based gains from Jack Daniel’s family of brands and its portfolio of RTDs among others. The firm notes that its American whiskey portfolio continues to grow rapidly in the US, including double-digit underlying net sales gains from Woodford Reserve and Old Forester. Herradura and el Jimador tequila continued to perform well with double-digit net sales as both brands maintained their momentum in the on and off-premise.

Sales in developed markets outside the US remained strong, delivering 9% growth year-to-date. The UK and Germany reported 10% and 16% growth respectively, while Australia posted 10% growth. Japan was the only developed market that saw declines due to volume declines in Early Times.

Emerging Markets remained strong despite increasingly difficult comparisons. Reported net sales grew 19% year-to-date, with the company’s two largest markets, Mexico and Poland reporting 13% and 25% growth respectively, driven by strong demand for Jack Daniel’s family of brands as well as growth of tequilas in Mexico.

In other emerging markets outside of Poland and Mexico, net sales grew in the high teens, as economic conditions have improved and currencies have stabilized. Russia, Turkey, Brazil, Thailand, China and Ukraine grew underlying net sales in the double-digits.

On outlook, the company reaffirmed its 2018 guidance for net sales growth of between 6% and 7% and Operating Income growth of 8% to 9%.

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