American spirits firm Brown-Forman Corp on Wednesday reported its full-year results for the year ending 30 April 2017. The company said that full-year revenue declined 3% to $3.9bn, from $4bn a year earlier, with the spirits maker experiencing a sharp decline of 5% in the fourth quarter compared to 4% in the third quarter.

The decline in sales was blamed on currency headwinds and acquisition and divestitures. Brown-Forman sold two of its premium liqueur brands, Southern Comfort and Tuaca to Sazerac, another U.S. spirits company in 2016. While the sale helped Brown-Forman book a large gain last year, it created a tough comparison for the current year.

The company said that inventory fluctuations also had an impact on sales as wholesalers had fewer inventories on hand than in the previous year. However, the firm said that situation was temporary. Brown-Forman noted that its non-branded business, particularly sales of used barrels experienced an 18% year-to-date decline.

Full year net income for the spirits maker fell sharply by 37% to $669m, from $1.06bn in the previous year. Net income in the fourth quarter alone dropped to $144m, from $522m in the preceding year.

Paul Varga, Brown-Forman’s chief executive officer said, “Fiscal 2017 was another year of strong underlying growth and excellent progress in positioning Brown-Forman for continued gains in the years ahead.

“Given the acceleration we experienced in the second half of the year, the investments we continue to make behind the business, and the expectation of improved contribution from innovation next year, we are forecasting another strong year in fiscal 2018, with mid-single digit underlying net sales growth and operating expense leverage driving 6-8% growth in underlying operating income.”

Despite the sales decline, Brown-Forman said that underlying sales rose 3%, improving to 4% in the second half of the year, driven by broad-based gains across its Jack Daniel’s portfolio in the United States and solid momentum in developed markets outside the U.S.

It noted that emerging markets experienced a significant improvement in the year, with second-half underlying net sales rising by 8% (-1% reported) compared to the first-half’s 1% decline (-13% reported). The company said that growth was strong particularly in Mexico and Poland, which registered 15% and 9% growth respectively.

Looking to 2018, Brown-Forman said that the global economy remains volatile, particularly in the emerging markets, and the competitive landscape has intensified in the developed world, making it difficult to predict future results.

However, assuming no deterioration in the current trends, the company anticipates underlying net sales growth of 4% to 5% and underlying operating income growth of 6% to 8%.

The company noted that it was targeting three year cost savings of $100m through better leveraging prior investments, including production capabilities, route-to-market initiatives, brand innovation, homeplace assets, and its employees.