Brown-Forman: U.S. Trends Normalizing, Third Quarter Sales Up 4%March 8, 2023
Brown-Forman saw sales increase 12% to $3.2 billion on an organic basis for the nine months through January, representing the first three quarters of its fiscal year. Operating income was up 9% to $829 million on an organic basis, but fell 13% on a reported basis, as the company booked a $96 million impairment on the Finlandia brand and higher operating expenses, including “certain post-closing costs and expenses in connection with the acquisitions of Diplomático and Gin Mare.” Those two purchases, made last year, were reportedly worth a combined $1.25 billion.
In the three months through January, Brown-Forman’s sales grew 5% globally and 4% in the U.S., where the company has noted that trends are “normalizing” after a three-year run of elevated growth, echoing the statements of other top players early this year. U.S. growth has lately been led by Woodford Reserve, which jumped 14% to nearly 1.3 million cases in calendar 2022, according to Impact Databank. Other brands on the rise last year included El Jimador and Herradura Tequilas, as well as Old Forester Bourbon and Jack Daniel’s RTDs. In the wine category, Sonoma-Cutrer had a particularly strong year, growing 17% to 543,000 cases.
Brown-Forman noted that it has ramped up advertising on key brands, with advertising expenses rising 24% organically for the nine-month period, “driven by increased investment to support Jack Daniel’s Tennessee Whiskey, Woodford Reserve, the launch of Jack Daniel’s Bonded, and Herradura in the United States.” For its full fiscal year ending in April, the company is expecting sales growth of 8% to 10%, coupled with high single-digit organic operating income growth.
“Brown-Forman continues to deliver strong net sales growth year-to-date, as we executed our strategic priorities and invested boldly behind our brands and our people,” said president and CEO Lawson Whiting. “Even as trends begin to normalize, we believe our business will remain robust given the premiumization of our portfolio, the health of our brands, and the resolve of our people.”—Daniel Marsteller
|Brown-Forman—Top 10 Spirits Brands in the U.S.
(thousands of 9-liter case depletions)
|1||Jack Daniel’s2||Tennessee Whiskey||5,570||5,434||-2.4%|
|5||Gentleman Jack||Tennessee Whiskey||458||439||-4.2%|
|7||Jack Daniel’s RTDs5||Premixed Cocktail||260||419||61.0%|
|Total Top 10||10,418||10,677||2.5%|
|1 Based on unrounded data.
2 Excludes flavors and RTDs/FMBs; includes Single Barrel, Bonded, Rye, No. 27 Gold, and Sinatra.
3 Includes Double Oaked and Reserve Rye.
4 Includes 86 proof, 100 proof, and craft.
5 Excludes Country Cocktails (malt-based)
Source: IMPACT DATABANK © 2023
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Tagged : Brown-Forman, El Jimador, Herradura, Jack Daniel's, Old Forester, Woodford Reserve
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