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LOUISVILLE, Ky.–(BUSINESS WIRE)–Schedule D Supplemental Information should read: Developed International (3%), Emerging 1%, Travel Retail 3% (instead of Developed International 1%, Emerging 3%, Travel Retail (1%).)
The updated release reads:
BROWN-FORMAN REPORTS FIRST QUARTER FISCAL 2024 RESULTS; REAFFIRMS FULL YEAR OUTLOOK
Brown-Forman Corporation (NYSE: BFA, BFB) reported financial results for its first quarter of fiscal 2024 ended July 31, 2023, with reported net sales increasing 3%1 to $1.0 billion (+2% on an organic basis2). In the quarter, reported operating income decreased 4% to $327 million (-6% on an organic basis) and diluted earnings per share decreased 7% to $0.48.
Lawson Whiting, Brown-Forman’s President and Chief Executive Officer stated, “As anticipated, our first quarter growth was impacted by the difficult shipment comparison from fiscal 2023, when we rebuilt inventory impacted by prior glass supply challenges. We continue to be confident in the strength of our people, our brands, and our business, and reaffirm our full-year fiscal 2024 guidance of 5-7% organic net sales growth and 6-8% organic operating income growth.”
First Quarter of Fiscal 2024 Highlights
First Quarter of Fiscal 2024 Brand Results
First Quarter of Fiscal 2024 Market Results
First Quarter of Fiscal 2024 Other P&L Items
First Quarter of Fiscal 2024 Financial Stewardship
On July 27, 2023, the Brown-Forman Board of Directors declared a regular quarterly cash dividend of $0.2055 per share on its Class A and Class B common stock. The dividend is payable on October 2, 2023, to stockholders of record on September 5, 2023. Brown-Forman, a member of the prestigious S&P 500 Dividend Aristocrats Index, has paid regular quarterly cash dividends for 79 consecutive years and has increased the regular dividend for 39 consecutive years.
Fiscal 2024 Outlook
While we remain optimistic about our prospects for growth of organic net sales and organic operating income in fiscal 2024, we continue to believe trends will normalize after two consecutive years of double-digit organic net sales growth. Accordingly, we reiterate our guidance and expect the following in fiscal 2024:
Conference Call Details
Brown-Forman will host a conference call to discuss these results at 10:00 a.m. (ET) today. A live audio broadcast of the conference call, and the accompanying presentation slides, will be available via Brown-Forman’s website, brown-forman.com, through a link to “Investors/Events & Presentations.” A digital audio recording of the conference call and the presentation slides will also be posted on the website and will be available for at least 30 days following the conference call.
For more than 150 years, Brown-Forman Corporation has enriched the experience of life by responsibly building fine quality beverage alcohol brands, including Jack Daniel’s Tennessee Whiskey, Jack Daniel’s Ready-to-Drinks, Jack Daniel’s Tennessee Honey, Jack Daniel’s Tennessee Fire, Jack Daniel’s Tennessee Apple, Gentleman Jack, Jack Daniel’s Single Barrel, Woodford Reserve, Old Forester, Coopers’ Craft, The GlenDronach, Benriach, Glenglassaugh, Slane, Herradura, el Jimador, New Mix, Korbel, Sonoma-Cutrer, Chambord, Fords Gin, Gin Mare, and Diplomático Rum. Brown-Forman’s brands are supported by approximately 5,600 employees globally and sold in more than 170 countries worldwide. For more information about the company, please visit brown-forman.com. Follow us on LinkedIn, Instagram, and Twitter.
Important Information on Forward-Looking Statements:
This press release contains statements, estimates, and projections that are “forward-looking statements” as defined under U.S. federal securities laws. Words such as “aim,” “anticipate,” “aspire,” “believe,” “can,” “continue,” “could,” “envision,” “estimate,” “expect,” “expectation,” “intend,” “may,” “might,” “plan,” “potential,” “project,” “pursue,” “see,” “seek,” “should,” “will,” “would,” and similar words indicate forward-looking statements, which speak only as of the date we make them. Except as required by law, we do not intend to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. By their nature, forward-looking statements involve risks, uncertainties, and other factors (many beyond our control) that could cause our actual results to differ materially from our historical experience or from our current expectations or projections. These risks and uncertainties include, but are not limited to:
For further information on these and other risks, please refer to our public filings, including the “Risk Factors” section of our annual report on Form 10-K and those described in future reports filed with the Securities and Exchange Commission.
Brown-Forman Corporation |
|||||||||||
Unaudited Consolidated Statements of Operations |
|||||||||||
For the Three Months Ended July 31, 2022 and 2023 |
|||||||||||
(Dollars in millions, except per share amounts) |
|||||||||||
|
2022 |
|
2023 |
|
Change |
||||||
|
|
|
|
|
|
||||||
Net sales |
$ |
1,007 |
|
|
$ |
1,038 |
|
|
3 |
% |
|
Cost of sales |
|
385 |
|
|
|
387 |
|
|
1 |
% |
|
Gross profit |
|
622 |
|
|
|
651 |
|
|
5 |
% |
|
Advertising expenses |
|
110 |
|
|
|
131 |
|
|
19 |
% |
|
Selling, general, and administrative expenses |
|
175 |
|
|
|
200 |
|
|
14 |
% |
|
Other expense (income), net |
|
(6 |
) |
|
|
(7 |
) |
|
|
||
Operating income |
|
343 |
|
|
|
327 |
|
|
(4 |
)% |
|
Non-operating postretirement expense |
|
— |
|
|
|
1 |
|
|
|
||
Interest expense, net |
|
17 |
|
|
|
27 |
|
|
|
||
Income before income taxes |
|
326 |
|
|
|
299 |
|
|
(8 |
)% |
|
Income taxes |
|
77 |
|
|
|
68 |
|
|
|
||
Net income |
$ |
249 |
|
|
$ |
231 |
|
|
(7 |
)% |
|
|
|
|
|
|
|
||||||
Earnings per share: |
|
|
|
|
|
||||||
Basic |
$ |
0.52 |
|
|
$ |
0.48 |
|
|
(7 |
)% |
|
Diluted |
$ |
0.52 |
|
|
$ |
0.48 |
|
|
(7 |
)% |
|
|
|
|
|
|
|
||||||
Gross margin |
|
61.8 |
% |
|
|
62.7 |
% |
|
|
||
Operating margin |
|
34.0 |
% |
|
|
31.5 |
% |
|
|
||
|
|
|
|
|
|
||||||
Effective tax rate |
|
23.6 |
% |
|
|
22.9 |
% |
|
|
||
|
|
|
|
|
|
||||||
Cash dividends paid per common share |
$ |
0.1885 |
|
|
$ |
0.2055 |
|
|
|
||
|
|
|
|
|
|
||||||
Shares (in thousands) used in the calculation of earnings per share |
|
|
|
|
|
||||||
Basic |
|
479,079 |
|
|
|
479,353 |
|
|
|
||
Diluted |
|
480,444 |
|
|
|
480,383 |
|
|
|
Brown-Forman Corporation |
||||||
Unaudited Condensed Consolidated Balance Sheets |
||||||
(Dollars in millions) |
||||||
|
April 30, |
|
July 31, |
|||
2023 |
2023 |
|||||
Assets: |
|
|
|
|||
Cash and cash equivalents |
$ |
374 |
|
$ |
426 |
|
Accounts receivable, net |
|
855 |
|
|
872 |
|
Inventories |
|
2,283 |
|
|
2,502 |
|
Assets held for sale |
|
— |
|
|
135 |
|
Other current assets |
|
289 |
|
|
255 |
|
Total current assets |
|
3,801 |
|
|
4,190 |
|
|
|
|
|
|||
Property, plant, and equipment, net |
|
1,031 |
|
|
1,050 |
|
Goodwill |
|
1,457 |
|
|
1,494 |
|
Other intangible assets |
|
1,164 |
|
|
1,014 |
|
Other assets |
|
324 |
|
|
338 |
|
Total assets |
$ |
7,777 |
|
$ |
8,086 |
|
|
|
|
|
|||
Liabilities: |
|
|
|
|||
Accounts payable and accrued expenses |
$ |
827 |
|
$ |
761 |
|
Dividends payable |
|
— |
|
|
98 |
|
Accrued income taxes |
|
22 |
|
|
47 |
|
Short-term borrowings |
|
235 |
|
|
389 |
|
Liabilities held for sale |
|
— |
|
|
13 |
|
Total current liabilities |
|
1,084 |
|
|
1,308 |
|
|
|
|
|
|||
Long-term debt |
|
2,678 |
|
|
2,687 |
|
Deferred income taxes |
|
323 |
|
|
324 |
|
Accrued postretirement benefits |
|
171 |
|
|
171 |
|
Other liabilities |
|
253 |
|
|
258 |
|
Total liabilities |
|
4,509 |
|
|
4,748 |
|
|
|
|
|
|||
Stockholders’ equity |
|
3,268 |
|
|
3,338 |
|
|
|
|
|
|||
Total liabilities and stockholders’ equity |
$ |
7,777 |
|
$ |
8,086 |
Brown-Forman Corporation |
||||||||
Unaudited Condensed Consolidated Statements of Cash Flows |
||||||||
For the Three Months Ended July 31, 2022 and 2023 |
||||||||
(Dollars in millions) |
||||||||
|
2022 |
|
2023 |
|||||
|
|
|
|
|||||
Cash provided by operating activities |
$ |
173 |
|
|
$ |
38 |
|
|
|
|
|
|
|||||
Cash flows from investing activities: |
|
|
|
|||||
Additions to property, plant, and equipment |
|
(33 |
) |
|
|
(49 |
) |
|
Other |
|
(1 |
) |
|
|
5 |
|
|
Cash provided by (used for) investing activities |
|
(34 |
) |
|
|
(44 |
) |
|
|
|
|
|
|||||
Cash flows from financing activities: |
|
|
|
|||||
Net change in other short-term borrowings |
|
— |
|
|
|
153 |
|
|
Dividends paid |
|
(90 |
) |
|
|
(99 |
) |
|
Other |
|
(4 |
) |
|
|
(4 |
) |
|
Cash provided by (used for) financing activities |
|
(94 |
) |
|
|
50 |
|
|
|
|
|
|
|||||
Effect of exchange rate changes |
|
(14 |
) |
|
|
8 |
|
|
|
|
|
|
|||||
Net increase (decrease) in cash, cash equivalents, and restricted cash |
|
31 |
|
|
|
52 |
|
|
|
|
|
|
|||||
Cash, cash equivalents, and restricted cash at beginning of period |
|
874 |
|
|
|
384 |
|
|
|
|
|
|
|||||
Cash, cash equivalents, and restricted cash at end of period |
|
905 |
|
|
|
436 |
|
|
Less: Restricted cash at end of period |
|
(6 |
) |
|
|
(10 |
) |
|
Cash and cash equivalents at end of period |
$ |
899 |
|
|
$ |
426 |
|
Schedule A |
|||
Brown-Forman Corporation |
|||
Supplemental Statement of Operations Information (Unaudited) |
|||
|
|
||
Percentage change versus the prior year period ended |
July 31, 2023 |
||
3 Months |
|||
Reported change in net sales |
3 |
% |
|
Acquisitions and divestitures |
(2 |
%) |
|
Foreign exchange |
1 |
% |
|
Organic change in net sales2 |
2 |
% |
|
|
|
||
Reported change in gross profit |
5 |
% |
|
Acquisitions and divestitures |
(1 |
%) |
|
Foreign exchange |
2 |
% |
|
Organic change in gross profit2 |
5 |
% |
|
|
|
||
Reported change in advertising expenses |
19 |
% |
|
Acquisitions and divestitures |
(5 |
%) |
|
Foreign exchange |
(1 |
%) |
|
Organic change in advertising expenses2 |
14 |
% |
|
|
|
||
Reported change in SG&A |
14 |
% |
|
Acquisitions and divestitures |
(1 |
%) |
|
Foreign exchange |
(1 |
%) |
|
Organic change in SG&A2 |
12 |
% |
|
|
|
||
Reported change in operating income |
(4 |
%) |
|
Acquisitions and divestitures |
(1 |
%) |
|
Impairment Charges |
— |
% |
|
Foreign exchange |
— |
% |
|
Organic change in operating income2 |
(6 |
%) |
|
|
|
|
|
See “Note 2 – Non-GAAP Financial Measures” for details on our use of Non-GAAP financial measures, how these measures are calculated, and the reasons why we believe this information is useful to readers.
Note: Totals may differ due to rounding.
Schedule B |
|
|
|
|
|
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Brown-Forman Corporation |
|
|
|
|
|
||||||||||||||||||
Supplemental Statement of Operations Information (Unaudited) |
|
|
|
|
|
||||||||||||||||||
Three Months Ended July 31, 2023 |
|
|
|
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Supplemental Information3 |
|
|
|
|
|
|
|
|||||||||||||||
|
Volumes (9-Liter Cases) |
|
Net Sales % Change vs. 2022 |
||||||||||||||||||||
|
|
% Change |
|
|
|
% Change |
|
|
|
|
|
|
|
|
|
||||||||
|
|
vs. Prior |
|
|
|
vs. Prior |
|
|
|
Acquisitions |
|
|
|
|
|
||||||||
Depletions |
|
Year |
|
Shipments |
|
Year |
|
|
|
and |
|
Foreign |
|
|
|
||||||||
Product Category / Brand Family / Brand3 |
(Millions) |
|
Period |
|
(Millions) |
|
Period |
|
Reported |
|
Divestitures |
|
Exchange |
|
|
Organic2 |
|||||||
Whiskey |
5.4 |
2 |
% |
5.3 |
(4 |
%) |
|
(1 |
%) |
— |
% |
2 |
% |
|
|
— |
% |
||||||
JDTW |
3.7 |
1 |
% |
3.7 |
(2 |
%) |
|
— |
% |
— |
% |
3 |
% |
|
|
2 |
% |
||||||
JDTH |
0.5 |
3 |
% |
0.5 |
(15 |
%) |
|
(1 |
%) |
— |
% |
— |
% |
|
|
— |
% |
||||||
Gentleman Jack |
0.2 |
4 |
% |
0.2 |
(13 |
%) |
|
(16 |
%) |
— |
% |
4 |
% |
|
|
(13 |
%) |
||||||
JDTF |
0.2 |
(5 |
%) |
0.1 |
(17 |
%) |
|
(19 |
%) |
— |
% |
1 |
% |
|
|
(19 |
%) |
||||||
JDTA |
0.2 |
39 |
% |
0.2 |
39 |
% |
|
49 |
% |
— |
% |
3 |
% |
|
|
52 |
% |
||||||
Woodford Reserve |
0.4 |
9 |
% |
0.4 |
(10 |
%) |
|
(9 |
%) |
— |
% |
— |
% |
|
|
(8 |
%) |
||||||
Old Forester |
0.1 |
10 |
% |
0.1 |
(8 |
%) |
|
(9 |
%) |
— |
% |
— |
% |
|
|
(9 |
%) |
||||||
Rest of Whiskey |
0.1 |
(13 |
%) |
0.1 |
(5 |
%) |
|
8 |
% |
— |
% |
— |
% |
|
|
8 |
% |
||||||
Ready-to-Drink |
5.4 |
— |
% |
6.1 |
(4 |
%) |
|
9 |
% |
— |
% |
(4 |
%) |
|
|
5 |
% |
||||||
JD RTD/RTP |
2.8 |
(8 |
%) |
3.5 |
(13 |
%) |
|
— |
% |
— |
% |
(1 |
%) |
|
|
— |
% |
||||||
New Mix |
2.6 |
12 |
% |
2.6 |
12 |
% |
|
52 |
% |
— |
% |
(21 |
%) |
|
|
32 |
% |
||||||
Tequila |
0.6 |
— |
% |
0.6 |
6 |
% |
|
15 |
% |
— |
% |
(3 |
%) |
|
|
12 |
% |
||||||
Herradura |
0.2 |
5 |
% |
0.2 |
(2 |
%) |
|
1 |
% |
— |
% |
(4 |
%) |
|
|
(3 |
%) |
||||||
el Jimador |
0.4 |
1 |
% |
0.4 |
11 |
% |
|
27 |
% |
— |
% |
(1 |
%) |
|
|
26 |
% |
||||||
Wine |
0.4 |
(3 |
%) |
0.4 |
(12 |
%) |
|
(12 |
%) |
— |
% |
— |
% |
|
|
(12 |
%) |
||||||
Vodka |
0.6 |
(2 |
%) |
0.6 |
3 |
% |
|
13 |
% |
— |
% |
2 |
% |
|
|
15 |
% |
||||||
Rest of Portfolio |
0.1 |
(4 |
%) |
0.1 |
(17 |
%) |
|
97 |
% |
(97 |
%) |
5 |
% |
|
|
5 |
% |
||||||
Non-branded & bulk |
NM |
NM |
NM |
NM |
|
21 |
% |
— |
% |
— |
% |
|
|
21 |
% |
||||||||
Total Portfolio |
12.6 |
1 |
% |
13.2 |
(4 |
%) |
|
3 |
% |
(2 |
%) |
1 |
% |
|
|
2 |
% |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other Brand Aggregations |
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Jack Daniel’s Family of Brands |
7.7 |
(2 |
%) |
8.3 |
(8 |
%) |
|
— |
% |
— |
% |
2 |
% |
|
|
2 |
% |
||||||
American Whiskey |
5.4 |
3 |
% |
5.3 |
(4 |
%) |
|
(1 |
%) |
— |
% |
2 |
% |
|
|
1 |
% |
||||||
Premium Bourbons |
0.5 |
9 |
% |
0.5 |
(10 |
%) |
|
(9 |
%) |
— |
% |
— |
% |
|
|
(9 |
%) |
|
|
See “Note 2 – Non-GAAP Financial Measures” for details on our use of Non-GAAP financial measures, how these measures are calculated, and the reasons why we believe this information is useful to readers.
Note: Totals may differ due to rounding.
Schedule C |
|
|
|
|
|
||||||||
Brown-Forman Corporation |
|
|
|
||||||||||
Supplemental Statement of Operations Information (Unaudited) |
|
|
|
||||||||||
Three Months Ended July 31, 2023 |
|
|
|
||||||||||
|
|
|
|
|
|
|
|||||||
|
Net Sales % Change vs. Prior Year Period |
||||||||||||
Acquisitions |
|
|
|||||||||||
and |
|
Foreign |
|||||||||||
Geographic Area3 |
Reported |
Divestitures |
|
Exchange |
|
|
Organic2 |
||||||
United States |
(8 |
%) |
(1 |
%) |
— |
% |
|
|
(9 |
%) |
|||
Developed International |
5 |
% |
(4 |
%) |
(1 |
%) |
|
|
— |
% |
|||
Germany |
7 |
% |
(1 |
%) |
(2 |
%) |
|
|
4 |
% |
|||
Australia |
(14 |
%) |
— |
% |
2 |
% |
|
|
(13 |
%) |
|||
United Kingdom |
21 |
% |
(1 |
%) |
(6 |
%) |
|
|
15 |
% |
|||
France |
5 |
% |
— |
% |
(2 |
%) |
|
|
3 |
% |
|||
Canada |
(3 |
%) |
— |
% |
2 |
% |
|
|
(1 |
%) |
|||
Japan |
(83 |
%) |
— |
% |
(4 |
%) |
|
|
(88 |
%) |
|||
Rest of Developed International |
23 |
% |
(16 |
%) |
(1 |
%) |
|
|
7 |
% |
|||
Emerging |
27 |
% |
(1 |
%) |
5 |
% |
|
|
32 |
% |
|||
Mexico |
44 |
% |
— |
% |
(20 |
%) |
|
|
24 |
% |
|||
Poland |
22 |
% |
(1 |
%) |
— |
% |
|
|
22 |
% |
|||
Brazil |
22 |
% |
— |
% |
(4 |
%) |
|
|
18 |
% |
|||
Rest of Emerging |
20 |
% |
(1 |
%) |
22 |
% |
|
|
41 |
% |
|||
Travel Retail |
13 |
% |
(3 |
%) |
(1 |
%) |
|
|
9 |
% |
|||
Non-branded and bulk |
21 |
% |
— |
% |
— |
% |
|
|
21 |
% |
|||
Total |
3 |
% |
(2 |
%) |
1 |
% |
|
|
2 |
% |
|
|
See “Note 2 – Non-GAAP Financial Measures” for details on our use of Non-GAAP financial measures, how these measures are calculated, and the reasons why we believe this information is useful to readers.
Note: Totals may differ due to rounding.
Schedule D |
|
||
Brown-Forman Corporation |
|
||
Supplemental Information (Unaudited) — Estimated Net Change in Distributor Inventories1 |
|||
Three Months Ended July 31, 2023 |
|
||
|
Estimated Net Change in Distributor Inventories3 |
||
Geographic Area3 – Net Sales |
|||
United States |
(11 |
%) |
|
Developed International |
(3 |
%) |
|
Emerging |
1 |
% |
|
Travel Retail |
3 |
% |
|
Non-Branded and Bulk |
— |
% |
|
|
|
||
Product category / brand family / brand1 |
|
||
Whiskey |
(7 |
%) |
|
JDTW |
(2 |
%) |
|
JDTH |
(25 |
%) |
|
Gentleman Jack |
(19 |
%) |
|
JDTF |
(17 |
%) |
|
JDTA |
1 |
% |
|
Woodford Reserve |
(20 |
%) |
|
Old Forester |
(20 |
%) |
|
Rest of Whiskey |
9 |
% |
|
Ready-to-Drink |
(2 |
%) |
|
JD RTD/RTP |
(2 |
%) |
|
New Mix |
— |
% |
|
Tequila |
1 |
% |
|
Herradura |
(9 |
%) |
|
el Jimador |
9 |
% |
|
Wine |
(11 |
%) |
|
Vodka (Finlandia) |
6 |
% |
|
Rest of Portfolio |
(19 |
%) |
|
Non-branded and bulk |
— |
% |
|
|
|
||
Statement of Operations Line Items |
|
||
Net Sales |
(6 |
%) |
|
Cost of Sales |
(5 |
%) |
|
Gross Profit |
(7 |
%) |
|
Operating Income |
(12 |
%) |
|
|
|
|
|
A positive difference is interpreted as a net increase in distributors’ inventories; whereas, a negative difference is interpreted as a net decrease in distributors’ inventories.
Note 1 – Percentage growth rates are compared to the same prior-year periods, unless otherwise noted.
Note 2 – Non-GAAP Financial Measures
Use of Non-GAAP Financial Information. We use some financial measures in this press release that are not measures of financial performance under U.S. generally accepted accounting principles (GAAP). These non-GAAP measures, defined below, should be viewed as supplements to (not substitutes for) our results of operations and other measures reported under GAAP. Other companies may not define or calculate these non-GAAP measures in the same way. Reconciliations of these non-GAAP measures to the most closely comparable GAAP measures are presented on Schedules A, B, and C of this press release.
Contacts
Rob Frederick
Vice President
Corporate Communications
rob_frederick@b-f.com
502-774-7707
Sue Perram
Vice President
Investor Relations
sue_perram@b-f.com
502-774-6862
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