The following is a summary of the Brown-Forman Corporation (BF.B) Q3 2024 Earnings Call Transcript:
Financial Performance:
Brown-Forman reported FY 2024 Q3 net sales growth of 1% and a flat organic net sales growth.
Reported and organic gross profit witnessed an upswing by 5% and 6% respectively.
The company experienced a 290 basis point contribution to gross margin due to price/mix contribution, absence of supply chain disruption costs, and decreased tariff-related costs.
A reported gross margin expansion of 250 basis points occurred due to raised prices and a more stable cost environment.
Company's diluted earnings per share experienced a rise by 32% to $1.58 per share.
A share repurchase program of up to $400 million was successfully completed.
Despite an 11% decrease in operating expenses, a growth of 25% in reported operating income and a 2% increase in organic operating income was reported.
Business Progress:
Key brands such as Jack Daniel's Tennessee Apple, New Mix, and Glenglassaugh significantly contributed to the company's organic net sales growth.
The international roll-out of Jack Daniel's Tennessee Apple is amplified due to a relieved supply environment.
Brown-Forman ventures into super and ultra-premium brands with Gin Mare and Diplomatico, which show robust double-digit organic net sales growth.
Despite US sales decline, an 11% rise in organic net sales was seen in emerging international markets.
New expressions in the premium Whiskey Row series were introduced by Old Forester.
Brown-Forman is set to establish its own distribution organization in Italy for driving the growth of its Jack Daniel`s family of brands.
An investment of $22.5 million was made towards environmental sustainability.
The company plans to broaden its geographic reach and increase its RTD business.
Confidence in long-term strategies and portfolio evolutions continues despite modest near-term expectations.
More details: Brown-Forman-B IR
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