Brown-Forman Reports Flat Organic Sales for First Half
December 5, 2024Brown-Forman reported flat organic sales of $2.0 billion for its fiscal first half for 2025, with operating income down 3% organically to $622 million. In the U.S., net sales were down 3% organically, led by volume declines for Jack Daniel’s and Korbel California Champagne, as well as Brown-Forman’s divestiture of Sonoma-Cutrer. In addition, the company reported that its change in production model for Jack Daniel’s Country Cocktails—beginning in 2021, Brown-Forman partnered with Pabst to produce the FMBs, with production fully shifting to the brewer in 2024—also contributed to this half’s results.
Despite the sustained challenges faced by the company, leadership remains optimistic for Brown-Forman’s fiscal second half. “Despite challenging economic conditions, our results for the first half of the fiscal year were in line with our expectations, and we anticipate a return to growth in fiscal 2025,” said Lawson Whiting, Brown-Forman’s president and CEO.
The company reported that net sales declined across all regions, but, in sequential terms, Travel Retail and international markets improved. A 4% organic decline in gross profit to $1.2 billion for the half was attributed to the company divesting from both Finlandia and Sonoma-Cutrer.
For the half, Brown-Forman’s whiskies showed mixed performance. The company reported growth for both Woodford Reserve and Old Forester but noted that the growth was offset by declines from Jack Daniel’s higher-end offerings, the Glendronach, and Glenglassaugh. Overall for Jack Daniel’s sales were flat organically, which the company noted was a sequential improvement.
Tequila, despite the category’s overall strength in the U.S., also declined for Brown-Forman, with the company reporting a 17% organic decline for the half. El Jimador dropped 16%, due to volume declines in the U.S. and Mexico, and Herradura dropped by 13%, led by declines in Mexico. Brown-Forman’s RTDs were a relative bright spot, with the company’s overall portfolio showing organic growth of 2%.
On a quarterly basis, the picture is somewhat brighter, with organic sales for Q2 up 3% to $1.1 billion. During that quarter, operating income was up 5% organically to $341 million. “We continue to expect our performance to accelerate through the second half of the year,” said Whiting.—Shane English
| Brown-Forman—Top 10 Spirits Brands in the U.S. (thousands of 9-liter cases) |
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| Rank | Brand | Origin/Type | Total 2023 Depletions |
Control States Volume Growth 2024 YTD1 |
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|---|---|---|---|---|---|---|
| 1 | Jack Daniel’s2 | Tennessee Whiskey | 5,144 | -4.2% | ||
| 2 | Woodford Reserve3 | Bourbon | 1,420 | 5.2% | ||
| 3 | El Jimador | Tequila | 885 | -8.9% | ||
| 4 | Jack & Coke4 | Premixed Cocktail | 832 | -12.5% | ||
| 5 | Jack Daniel’s Tennessee Honey5 |
Flavored Whiskey | 707 | -4.2% | ||
| 6 | Old Forester6 | Bourbon | 485 | 5.6% | ||
| 7 | Gentleman Jack | Tennessee Whiskey | 404 | -4.6% | ||
| 8 | Herradura | Tequila | 373 | -4.7% | ||
| 9 | Jack Daniel’s Tennessee Fire5 |
Flavored Whiskey | 356 | -6.2% | ||
| 10 | Korbel | Brandy | 227 | -9.6% | ||
| Total Top 107 | 10,834 | -3.0% | ||||
| 1 Year-to-date through October. 2 Excludes flavors, Winter Jack, and RTDs/FMBs; includes Single Barrel, Bonded, Rye, No. 27 Gold, and Sinatra. 3 Includes Double Oaked, Reserve Rye, Straight Wheat, and Straight Malt. 4 Includes Jack & Coke and Jack & Coke Zero; excludes other Jack Daniel’s RTDs. 5 Excludes RTDs. 6 Includes 86 proof, 100 proof, Single Barrel, Mint Julep, and Rye. 7 Addition of columns may not agree due to rounding. Source: NABCA and IMPACT DATABANK © 2024 |
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Tagged : Brown-Forman, El Jimador, Finlandia, Herradura, Jack Daniel's, Old Forester, Sonoma-Cutrer, Wordford Reserve
