Brown-Forman Corporation has announced a positive start to it’s 2019 fiscal year, ending July 31, 2018.
The drinks giant reported that its net sales increased by 6% to $766 million (€655 million) - a 9% increase on an underlying basis - compared to the same period last year.
Its operating income increased by 7% to $264 million - 10% on an underlying basis - and its diluted earnings per share few by 12% to $0.41.
Paul Varga, CEO, said that the company’s business momentum continued into the new fiscal year, boosting results.
“(Momentum continued) with strong net sales growth as consumer demand for our premium American whiskey brands remained robust,” Varga said.
“After considering the estimated impact of order phasing related to tariffs, our first quarter growth was in-line with last year’s underlying net sales growth and keeps us on track to deliver another strong year of top-line growth in the 6-7% range.”
Chief operating officer, and soon to be CEO, Lawson Whiting, highlighted that there still remains uncertainty around the recent trade tariffs.
“There remains significant uncertainty around the duration of recently enacted tariffs, but we have been encouraged by the resilience of our business model as we are working to minimise short-term disruption and maintain our top-line momentum,” Whiting said.
“We believe that our consistent reinvestment back into our brands and people positions us well over the long term to continue generating leading returns for our shareholders.”
The company delivered strong broad-based growth around the world, particularly in markets outside of the US.
It said that two to three points of underlying net sales growth to company-wide top-line results came from an increase in its retail and wholesale inventory levels, which was largely related to tariffs.
It added that the global economy has continued to improve over the last year, however recently enacted retaliatory tariffs on American whiskey has created additional uncertainty around the company’s near-term outlook.
Brown-Forman said it is difficult to accurately predict future results but anticipates an underlying net sales growth of 6% to 7%.
© 2018 Checkout – your source for the latest Irish retail news. Article by Aidan O’Sullivan. Click subscribe to sign up for the Checkout print edition.