Jack Daniel’s Tennessee Whiskey
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Jack Daniel’s maker Brown-Forman on Wednesday fell in need of Wall Street expectations for its first quarter of fiscal 2024, tormented by lagging whiskey sales, supply challenges and a major inventory rebuild.
Net sales for whiskey products decreased by 1%, led by the brands Woodford Reserve and Gentleman Jack. Sales for Jack Daniel’s Tennessee Whiskey were flat, the corporate said, attributable to lower distributor inventories across america.
“As anticipated, our first quarter growth was impacted by the difficult shipment comparison from fiscal 2023, once we rebuilt inventory impacted by prior glass supply challenges,” said Lawson Whiting, CEO of the Kentucky-based wines and spirits company.
Net sales within the U.S. market decreased 8% amid volume declines.
Meanwhile the corporate saw growth in its ready-to-drink, or RTD, and tequila categories.
Its Recent Mix RTD beverages delivered strong net sales growth of 52%, while its el Jimador tequila brand saw net sales grow by 27%. The corporate’s recent acquisition of its Gin Mare and Diplomático brands were also a vibrant spot.
“We proceed to be confident within 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,” Whiting said in a release.
The corporate reported overall quarterly revenue up 3% 12 months over 12 months and maintained its full-year outlook.
Here’s how Brown-Forman did for the three-month period that ended July 31, compared with what analysts expected, in keeping with consensus estimates from Refinitiv:
- Earnings per share: 48 cents vs. 53 cents expected
- Revenue: $1.04 billion vs. $1.05 billion expected
Net income for the period was $231 million, or 48 cents per share, down 7% from the prior-year period, when the corporate reported net income of $249 million, or 52 cents per share.
Marketing and operating costs soared in the course of the quarter, outpacing revenue growth and weighing on profits.
Reported promoting expense grew 19%, driven by the launch of its Jack Daniel’s & Coca-Cola RTD item, increased investment in Jack Daniel’s Tennessee Whiskey, and acquisitions.
— CNBC’s Robert Hum contributed to this report.