Brown-Forman Reports Strong First Half Results And Raises Full Year Outlook
Underlying sales growth was driven by continued expansion into the emerging markets, which contributed over 40% of incremental growth year to date. Growth rates were particularly strong in Russia, Brazil, Turkey, Mexico and Poland.
In the U.S., the company delivered strong results against the backdrop of an improving environment for spirits, contributing 40% of the company’s underlying sales growth year to date. The company’s premium brand portfolio has benefitted from consumers trading-up, as well as strong demand for North American whiskies.
In Europe, Germany, Belgium, the Netherlands and Austria enjoyed double-digit growth while results in countries such as Spain and Italy were impacted by weak economic conditions. Net sales in Western Europe, including the U.K. and France, were down low-single digits as market share gains were offset by deteriorating economic conditions and the impact from recent price and excise tax increases. The company expects the broader business environment in Western Europe to remain challenging. Net sales in Australia grew 7%, driven by continued strength in Jack Daniel’s Tennessee Whiskey and the launch of Jack Daniel’s Tennessee Honey.
The company’s Travel/Retail channel delivered 9% net sales growth, driven by successful innovation, new product launches, and price increases.Dividends and Other On November 15, 2012, Brown-Forman declared a regular quarterly cash dividend of $0.255 per share on Class A and Class B common stock, a 9.3% increase over the prior dividend and the 29 th consecutive year that Brown-Forman has increased its dividend. The cash dividend is payable on December 26, 2012 to stockholders of record on December 5, 2012. On November 27, 2012, the company also announced an additional special cash dividend of $4.00 per share on Class A and Class B common stock. This special cash dividend is payable on December 27, 2012 to stockholders of record on December 12, 2012. Given the uncertainty surrounding the renewal of the current dividend tax rates which expire on December 31, 2012, the company chose to make each of these payments in calendar 2012.
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