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Brown-Forman sales take 2% hit in Q1 on back of currency woes

Published:  27 August, 2015

Jack Daniel's producer Brown-Forman reported a 2% decline in net sales to US$900 million (£581.2 million) in the first quarter, to July 31, after being hit by currency exchange fluctuations.

Reported operating income increased by 3% to US$227 million (£146.6 million), an increase of 9% on an underlying basis.

The company said that underlying net sales grew in double digits in the UK, along with Germany and France.

Chief executive officer Paul Varga said: "Despite a volatile global economy, adverse foreign exchange and increasing competitive intensity, our growth in underlying sales and operating income were impressive, and continued to compare quite favourably to our industry competitive set."

Varga said growth was driven by Jack Daniel's and other American whiskeys in its portfolio. The Jack Daniel's family of brands increased underlying global sales by 6%. Woodford Reserve was up 28%.

He added: "Given our first quarter results and expectations for the continued global growth of our brands, we are confirming our fiscal 2016 outlook of 6% to 7% underlying sales growth, 8% to 10% underlying operating income growth, and earnings per share in the range of US$3.40-US$3.60."