Brown-Forman Q1 sales rise by 17%
Woodford Reserve owner Brown-Forman recorded a double-digit increase for the first quarter of fiscal 2023, propelled by its premium Bourbon portfolio.
Brown-Forman saw organic net sales increase by 17% to US$1 billion for the three months to 31 July 2022. Operating income soared by 32% to US$343 million over the period.
Lawson Whiting, Brown-Forman’s president and CEO, said the Q1 results build on the company’s “exceptional” performance in fiscal 2022, when net sales rose by 17%.
“Brown-Forman is off to a great start in fiscal 2023,” said Whiting. “Our strong strategic position, premium portfolio, continued innovation, and investment behind our brands have once again delivered double-digit revenue growth.”
The company’s premium Bourbon range, led by Woodford Reserve and Old Forester, climbed by 36% in organic net sales. Brown-Forman said the brands benefitted from increased distributor inventories.
The Jack Daniel’s family of brands rose by 19%, driven by the flagship Jack Daniel’s expression. The portfolio was boosted by ‘strong demand’ and increased prices in emerging markets, developed global markets and travel retail.
The ready-to-drink (RTD) portfolio also recorded double-digit growth, with Jack Daniel’s RTDs up by 17% organically, led by Australia and Germany.
Tequila-based RTD New Mix soared by 41%, boosted by Mexico.
Herradura Tequila declined by 5% after it reported ‘significant’ growth in the same period last year in the US. It was also affected by supply chain challenges.
Market performance
Net sales in the US were up by 7%, driven by Woodford Reserve, and the Jack Daniel’s Honey and Tennessee Fire expressions.
The company’s ‘developed international’ markets grew by 19%, with volume gains from the core Jack Daniel’s bottling and its RTDs, and growth in Australia, Germany and Spain.
Emerging markets recorded a 24% increase, boosted by Jack Daniel’s in Sub-Saharan Africa, Brazil, and Chile, as well as New Mix in Mexico.
Organic sales in travel retail skyrocketed by 85% as the channel continued to rebound.
The company upped its advertising spend by 28% organically, with an increased push in the US to support Jack Daniel’s, Herradura, the launch of the Jack Daniel’s Bonded Series, and Woodford Reserve.
Looking ahead to the full year, Brown-Forman expects both its organic net sales and operating income to grow by mid-single digits.
The removal of the EU and UK tariffs on American whiskey, as well as the effect of inflation, are projected to increase the company’s margins slightly, the firm said.
Whiting added: “While there is continued uncertainty in the market, I remain optimistic we can continue this momentum and deliver on both short- and long-term growth ambitions.”
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