Brown-Forman’s Sales Increase 3% In First Quarter Despite Tough ConditionsSeptember 2, 2020
Brown-Forman saw its underlying net sales grow 3% to $755 million for its fiscal first quarter with underlying operating income up 15% to $387 million. Despite the challenging conditions presented by the Covid-19 pandemic and the continued European tariffs on American whiskey, Brown-Forman president and CEO Lawson Whiting said he believed the company was positioned to weather these troubles and emerge in a stronger position. Sales in the U.S. and the company’s developed international markets were strong, up 9% and 12%, respectively. The company’s first quarter was less successful in its emerging markets, where sales were down 3%.
Overall, Jack Daniel’s was up 3%, though gains were concentrated in the brand’s RTD offerings, flavored releases like Tennessee Apple and Honey, and Gentleman Jack, with the flagship Tennessee Whiskey declining. According to Impact Databank, Tennessee Apple reached 165,000 cases last year, its first year on the market. The company attributed the flagship Old No.-7’s difficult year to a combination of the pandemic-related on-premise shutdown, lower volume in emerging markets, and the sharp decline in travel retail due to Covid.
Brown-Forman’s higher-end whiskies continued to drive gains for the company, with brands like Old Forester and Woodford Reserve seeing double-digit growth. Old Forester, in particular, benefited from the strong performance of its high-end expressions. Last year, Woodford was up 22% to 792,000 cases and Old Forester was up the same percentage to 271,000 cases in the U.S., according to Impact Databank. Tequila also benefited the company, which saw increased demand and higher pricing in both the U.S. and Mexico for El Jimador. Herradura, meanwhile, saw volume decline in Mexico, though those losses were partially offset by gains in the U.S.—Shane EnglishSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.