Brown-Forman Corp, maker of Jack Daniels whiskey, Woodford Reserve, Gentleman Jack, among others said on Wednesday that revenue for the first quarter fell 5% to $661m.

The company blamed the drop in sales on foreign exchange headwinds in emerging markets and the disposal of two of its brands, Southern Comfort and Tuaca during the period under review.

Paul Varga, the company’s Chief Executive Officer said, “Our first quarter reported results came in largely as anticipated considering the absence of previously disposed brands and the difficult comparisons against last year’s launch of Jack Daniel’s Tennessee Fire in the United States.

“While our results continue to be hampered by the combined effects of adverse foreign exchange and challenging emerging market conditions, we still expect fiscal 2017 to be another year of solid underlying sales and operating income growth, driven by the Jack Daniel’s family of brands, as well as our portfolio of premium bourbons and tequilas.”

Brown-Forman said that sales in developed markets outside the United States came in 5% lower. These includes the United Kingdom, Australia, Germany, France, Canada, Japan, Spain, New Zealand and Italy. The company notes that sales growths in these markets were driven by the Jack Daniels family of brands.

In emerging markets, the company reported a 17% revenue decline, weighed by weak economic conditions, devalued currencies and political instability. While the company’s two largest emerging markets, Poland and Mexico grew underlying net sales, results in other markets were down.

Brown-Forman said that net profit fell 8% for the period to $144m, down from $156m in 2015.