Tennessee Fire’s Rapid Rise Drives Brown-Forman’s U.S. GrowthMarch 2, 2016
The runaway success of Jack Daniel’s Tennessee Fire propelled Brown-Forman to solid U.S. sales growth in the first three quarters of its fiscal year, but that progress was offset somewhat by the negative currency exchange impact outside the U.S. market.
Brown-Forman’s underlying net sales rose by 7% in the U.S. for the nine months ended January 31. While Jack Daniel’s Tennessee Honey has leveled off in the market after years of double-digit advances, Tennessee Fire is rising sharply. Released in the latter part of 2014, Tennessee Fire sold more than 400,000 cases in 2015, according to Impact Databank. The new product contributed two percentage points to the Jack Daniel’s franchise’s growth through the first nine months of the fiscal year, according to Brown-Forman.
Tennessee Fire’s rapid rise has clearly impacted its intended target—Fireball. In both 2013 and 2014, Fireball grew by more than 1.5 million cases. However, in 2015, the Sazerac brand’s rise slowed to around 600,000 cases.
Brown-Forman’s overall net sales were up by 5% on an underlying basis for the first three quarters, but down by 2% on a reported basis, largely because of the strengthening dollar. For the full year, the company is projecting 5% underlying net sales growth and 7%-9% growth in underlying operating income.Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.