Brown-Forman Reports Flat Underlying Net Sales In FY 2020
Brown-Forman Corporation, the parent of Jack Daniel's, has reported flat underlying net sales in its financial year ended 30 April 2020.
The company’s reported net sales increased 1% to $3.4 billion in this period, while reported operating income decreased 5% to $1.1 billion, or 6% down on an underlying basis.
The spirits giant’s reported net sales for the fourth quarter dropped by 5% year-on-year to $709 million.
Reported operating income for the quarter dropped 18% to $187 million (-27% on an underlying basis), the company added.
Jane Morreau, the company’s executive vice president and chief financial officer, said, “COVID-19 began to affect our performance in the middle of March and continued throughout April as both on-premise, representing approximately 20% of our business globally, and Travel Retail channels essentially came to a halt.
“We experienced strong growth in the off-premise (based on syndicated takeaway data) and e-Premise channels across most of our developed markets as country lockdowns and government restrictions took hold, reflecting both an increase in at-home consumption and some pantry loading.”
The company saw 5% growth in underlying net sales in the United States, while sales in the developed international and emerging markets declined 1%.
Underlying net sales for the Jack Daniel’s family of brands remained flat (+1% reported), as underlying net sales growth from Jack Daniel’s Tennessee Apple, Jack Daniel’s RTDs, and Jack Daniel’s Tennessee Honey were offset by declines in Jack Daniel’s Tennessee Whiskey.
Premium bourbons reported an underlying net sales growth of 21%, driven by the good performance of Woodford Reserve’s and supported by Old Forester – the company’s founding brand, which is celebrating its 150th year.
The company’s tequila portfolio saw a 2% growth in underlying net sales, as high single-digit growth in the US was partially offset by declines in Mexico.
Herradura posted underlying net sales growth of 7%, while el Jimador reported 5% growth.
The company has not provided quantitative guidance for its financial year 2021 due to the uncertainty around the evolving COVID-19 pandemic and its impact on the global economy.
However, the company expects to continue funding its ongoing business investments and pay regular dividends.
President and chief executive officer, Lawson Whiting, said, “Brown-Forman has endured and prevailed through many challenges over the last 150 years.
“We believe we are well-positioned to successfully navigate the environment we face today and emerge stronger thanks to the continued support of our shareholders, including the Brown family, our healthy balance sheet, the resilience of our people, and the strength of our brands.”
© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Dayeeta Das. Click subscribe to sign up to ESM: The European Supermarket Magazine.