On Wednesday, Brown-Forman will report its first-quarter results. Here, just-drinks takes a look at the company's performance in the three months to the end of July:
- The quarter started with a rebrand: In the UK, Brown-Forman relaunched its Little Black Dress vodka as LBD. The move was backed by the extension of the brand to include three new flavours.
- Also in May, the company boosted its Brown family board membership with two new appointments. Augusta Brown Holland and Stuart Brown, both fifth-generation relatives of founder George Garvin Brown, were elected to the board.
- Towards the end of the month, the group closed on two property purchases in Louisville, Kentucky. The sites will become the new Old Forester Distillery. However, the planned opening of the facility has been put back by several months after a fire in July damaged buildings on the same street.
- In June, Brown-Forman became the latest international player to enter the Irish whiskey category, when it acquired Slane Castle Irish Whiskey Ltd. The US group stepped in where Camus Wine & Spirits had previously attempted to build a distillery on the Slane Castle estate. Brown-Forman will invest US$50m in a new production facility.
- In a conference call following the release of fiscal full-year results in June, CEO Paul Varga conceded that the Southern Comfort brand had continued to struggle, but flagged that the liqueur "would have competitively deteriorated more had we not taken some of the steps we've taken".
- Could the company have another flavoured success story on its hands? While Jack Daniel's Tennessee Honey continues to dazzle with double-digit sales rises in the last two fiscal years, the brand extension could yet be dwarfed by its Tennessee Fire sister iteration, The cinnamon-flavoured variant rolled out across the US in March and will be extended beyond the US in the coming months.
- The rye segment has been the surprise success story in the spirits category in recent years. Brown-Forman is looking to surf this wave with the launch in June of Woodford Reserve Kentucky Straight Rye Whiskey, the first permanent rye expression of the Woodford Reserve brand.
- Finally, towards the end of June, the company set about raising US$500m. The funds, which will be generated from the release of a set of 30-year senior notes, will be used for "general corporate purposes". Are further acquisitions on the horizon?
- The company's outlook, announced in June, is for underlying net sales to rise by 6% to 7%, with underlying operating profits forecast to be up by between 8% and 10%.
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