JD Tennessee Honey continues success in Q1

Brown-Forman has reported a slower sales growth in its first quarter results, but its Jack Daniel’s Tennessee Honey continued its strong performance.

While Brown-Forman has experienced a slower rate of growth in Q1 compared to last year, its Jack Daniel’s Tennessee Honey has continued its trail of success

Announcing its Q1 results for 2014/15, the US drinks group reported a net sales growth of 3% to US$921 million, a slower rate of growth than that achieved in the first quarter of 2013/14. Meanwhile, reported operating in come increased 1% to $221 million.

Paul Varga, CEO of Brown-Forman, said that the group’s first quarter growth came in lower than what it achieved during fiscal 2014 due to “distributor and retail inventory reductions in the United States and Europe”.

The group’s leading Jack Daniel’s Tennessee Whiskey trademark grew underlying net sales by 5% while Jack Daniel’s Tennessee Honey, which was recently revealed to be the first flavoured whiskey to reach one million case sales, grew underlying nets sales by 29%.

This growth has been attributed to the emerging success of the brand outside of the United States, indicating an emerging global trend for flavoured whiskeys.

Woodford Reserve Bourbon also continued the success reported in Brown-Forman’s full-year financial results for 2013/13, showing 29% net sales growth in Q1.

Meanwhile, the group’s new mix RTD’s category saw a huge 67% underlying sales growth and El Jimador and Herradura grew underlying net sales 15%.

The Finlandia vodka family however suffered a 13% underlying net sales decline due to weakness in Poland, while sales of Canadian mist fell 7% and the Southern Comfort portfolio also declined by 7%, hampered by competition from the flavoured whiskey segment.

In regional terms, Brown-Forman experienced 15% underlying net sales growth in the emerging markets, however sales in its key US market fell flat at -2% due to “difficult comparisons” with last year.

“We anticipate higher rates of sales growth over the balance of the year, led by Jack Daniel’s and our portfolio of premium whiskey brands,” said Varga. “We reaffirm our full-year guidance and our expectations of 9-11% underlying operating income growth in fiscal 2015.”