Australia Delivers ‘Solid Gains’ for Brown-Forman

Developed markets outside of the United States maintained their momentum for Brown-Forman Corporation into the third quarter of FY16, the company announced this week.

The United Kingdom, Australia, France, Canada and Spain “each delivered solid gains in underlying net sales”, Brown-Forman said.

However, the company’s revenue growth for the year-to-date was adversely affected by eight percentage points due to foreign exchange impacts, while a slowdown persisted in emerging markets.

Global Travel Retail’s underlying revenue decreased by 13 per cent for the year-to-date, which the company attributed to a “decline in spending from travellers, as well as continued volatility in foreign exchange”.

“Against a backdrop of deteriorating economic conditions in emerging markets, weakness in the global travel retail channel and headwinds from a strengthening dollar, we had another solid quarter of underlying growth, led by the Jack Daniel’s family and our American whiskey brands,” Chief Executive Officer Paul Varga said.

Brown-Forman reported earnings of $US278 million for the third quarter ended January 31, up two per cent or five per cent on an underlying basis. Revenue was down one per cent to $US1.08 billion (up four per cent on an underlying basis).

Jack Daniel’s Tennessee Fire, which was launched in Australia last month, contributed two percentage points to the JD family’s year-to-date underlying revenue growth.

For the first nine months of the fiscal year, the company’s revenue decreased two per cent (five per cent increase underlying) while earnings grew two per cent (seven per cent underlying).

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