LOUISVILLE, Ky. (AP) — Led by demand for its flagship Jack Daniel's brand, spirits maker Brown-Forman Corp. said Wednesday its first-quarter net income rose 5 percent despite lower stockpiling by distributors.
The company behind such other brands as Southern Comfort, Finlandia and el Jimador said the three-month performance was slowed by lower inventory levels by distributors, reflecting the company's decision to ease up on price increases. In the past two years, distributors stocked up ahead of larger price increases made by the company in the first quarter, inflating sales for the spirits maker. This year, the price hikes by Brown-Forman were much smaller.
The company said it expects more stable inventory levels for the rest of the fiscal year.
"We anticipate higher rates of sales growth over the balance of the year, led by Jack Daniel's and our portfolio of premium whiskey brands," Brown-Forman CEO Paul Varga said.
Underlying net sales for the entire Jack Daniel's brand grew by 5 percent in the quarter, led by 29 percent growth in Jack Daniel's Tennessee Honey. Underlying sales indicate revenue adjusted for foreign exchange fluctuations or unusual changes in distributor inventories.
The company reported mixed results for its other top brands.
For the quarter ending July 31, the company reported net income of $150 million, or 70 cents per share. That's compared to $143 million, or 66 cents per share, a year ago. Analysts expected earnings of 72 cents per share.
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