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Brown-Forman 1Q Profit Declines |
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Thursday, 28 August 2008 |
LOUISVILLE, Ky.: Liquor producer Brown-Forman Corp., maker of Jack Daniel's Tennessee Whiskey, reported a 7 percent profit decline for the first quarter on Thursday, dragged down by a $22 million pretax charge stemming from a problem with tequila production.
For the three months ended July 31, earnings totaled $88.2 million, or 73 cents per share, for the three months ended July 31 compared to $95.3 million, or 77 cents a share, in the year-ago period.
Net sales for the quarter rose 7 percent to $790 million from $739.1 million a year ago.
The problem with tequila production resulted a 13-cent-per-share charge for the quarter.
The company said the $22 million charge stemmed from an abnormal number of agave plants in Mexico that are dead or dying. The plants are the main raw material used in the company's tequila production.
Company spokesman Phil Lynch said the problem won't affect the company's tequila supply.
The company reported a mixed performance for its leading brands.
Global case sales for its flagship Jack Daniel's brand declined 1 percent for the quarter as gains in Eastern Europe and flat U.S. volumes were offset by declines in other key overseas markets. However, net sales for Jack Daniel's rose in the mid-single digits, boosted by price increases and a weak U.S. dollar.
Global case sales for its Finlandia vodka grew in the high single digits, led by continued double-digit growth in Eastern Europe. Southern Comfort case sales declined, which was offset partially by price increases.
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