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Brown-Forman Delivers Resilient Year-to-Date Performance in a Challenging Environment

Louisville, KY, March 3, 2021 – Brown-Forman Corporation (NYSE: BFA, BFB) reported financial results for its third quarter and nine months ended January 31, 2021. For the third quarter, the company’s reported net sales1 of $911 million increased 1% (flat on an underlying basis2) compared to the same prior-year period. In the quarter, reported operating income decreased 8% to $281 million (-8% on an underlying basis) and diluted earnings per share declined 5% to $0.45.

For the first nine months of the fiscal year, the company’s reported net sales of $2,649 million were flat (+2% on an underlying basis) compared to the same prior-year period. Year-to-date reported operating income increased 10% to $998 million (+3% on an underlying basis) and diluted earnings per share grew 12% to $1.63.

Brown-Forman’s President and Chief Executive Officer Lawson Whiting stated, “We remain pleased with our year-to-date underlying net sales growth, particularly when considering the unprecedented and challenging operating environment. Importantly, we remain focused on executing our long-term strategic priorities and our commitment to be better and do better as individuals and as a company. Our strategic priorities have enabled us to build strong business momentum during the COVID-19 crisis and we believe they remain the right strategies to deliver broad-based growth and value creation over the long term.”


Year-to-Date Fiscal 2021 Highlights

  • Underlying net sales grew 2% (flat reported).
    • The United States and our developed international3 markets each grew underlying net sales 7% (+3% and +10% reported, respectively), while underlying net sales in our emerging markets grew 1% (-8% reported).
    • Jack Daniel’s family of brands underlying net sales grew 2% (-2% reported) driven primarily by growth from Jack Daniel’s RTDs3, Jack Daniel’s Tennessee Apple, Jack Daniel’s Tennessee Honey, and Gentleman Jack. These gains were partially offset by a reduction in Jack Daniel’s Tennessee Whiskey’s underlying net sales.
    • Premium bourbons grew underlying net sales 21% (+18% reported), with both Woodford Reserve and Old Forester maintaining strong double-digit growth.
    • The tequila portfolio grew underlying net sales 6% (+2% reported) led by strong volume-driven increases from New Mix in Mexico.
  • Diluted earnings per share increased 12% to $1.63.


Year-to-Date Fiscal 2021 Brand Results

Underlying net sales growth for the Jack Daniel’s family of brands was driven by Jack Daniel’s RTDs, the continued international launch of Jack Daniel’s Tennessee Apple, and broad-based volume growth from Jack Daniel’s Tennessee Honey and Gentleman Jack. Jack Daniel’s Tennessee Whiskey’s underlying net sales decline was driven by lower volumes in the Travel Retail channel and certain emerging markets reflecting travel bans and other restrictions related to COVID-19 along with lower volumes and unfavorable channel mix shift in many developed international markets and the United States related to significant restrictions in the on-premise channel, partially offset by increased volumes in the off-premise channel in those markets.

Brown-Forman’s portfolio of premium bourbon brands, led by Woodford Reserve and Old Forester, maintained its double-digit underlying net sales growth. Strong consumer takeaway trends for Woodford Reserve continued to fuel robust double-digit volumetric growth in the United States. Volumetric gains and favorable product mix from Old Forester’s high-end expressions drove double-digit underlying net sales growth for the brand.

Underlying net sales growth for the company’s tequila brands was primarily driven by higher volumes of New Mix in Mexico. Double-digit underlying net sales growth for el Jimador and Herradura in the United States was largely offset by volumetric declines in Mexico.


Year-to-Date Fiscal 2021 Market Results

Underlying net sales growth in the United States was led by volumetric gains for our premium bourbons, Jack Daniel’s RTDs, Jack Daniel’s Tennessee Honey, Gentleman Jack, Herradura, and el Jimador. These gains were partially offset by declines in Jack Daniel’s Tennessee Whiskey reflecting channel mix shift and lower volumes due to on-premise restrictions and closures.

High single-digit underlying net sales growth in developed international markets was fueled by Jack Daniel’s RTDs, the ongoing launch of Jack Daniel’s Tennessee Apple, Jack Daniel’s Tennessee Honey, and our super-premium American and Scotch whiskeys. These gains, along with strong growth in the off-premise channel, were partially offset by lower volumes of Jack Daniel’s Tennessee Whiskey due to COVID-19 related restrictions, which severely limited and in some cases entirely shut down the on-premise channel.

The company’s emerging markets returned to underlying net sales growth through the first nine months of the fiscal year. Gains were led by Brazil, Poland, and China, largely offset by broad-based declines in Southeast Asia, India, and several Latin American markets as a result of COVID-19 related impacts.

Underlying net sales in Travel Retail continued to be significantly impacted by the continuation of COVID-19 related travel bans and restrictions.


Year-to-Date Fiscal 2021 Other P&L Items

Volumes grew 11% fueled by Jack Daniel’s RTDs and New Mix. Company-wide price/mix had a 9% unfavorable impact reflecting the portfolio mix shift with growth from lower-priced brands (Jack Daniel’s RTDs and New Mix) and the unfavorable channel mix shift (primarily for JDTW) from the on-premise channel related to COVID-19 restrictions across several developed markets globally.

Underlying gross profit declined 1% (-5% reported) and reported gross margin contracted 280 basis points to 60.3% driven by higher input costs, lower fixed cost absorption, and the negative effect of the portfolio and channel mix shift discussed above.

The company’s investment in underlying advertising increased in the third quarter as anticipated resulting in a year-to-date decline of 10% (-10% reported) largely reflecting the phasing of spend from the first half to the second half of the fiscal year. The company anticipates advertising investments will continue to accelerate significantly over the remainder of the fiscal year. Underlying SG&A declined 4% (-3% reported) driven by the tight management of discretionary spend.

Underlying operating income increased 3% (+10% reported), while diluted earnings per share increased 12% to $1.63, including an estimated $0.19 per share benefit from the gain on the sale of the Early Times, Canadian Mist, and Collingwood brands.


Financial Stewardship

Brown-Forman generated strong free cash flow2 of $531 million year-to-date, a $106 million increase over the same prior-year period primarily reflecting lower working capital requirements.

During the quarter, Brown-Forman’s Board of Directors approved a $125 million capital investment to expand bourbon making capacity in Kentucky to meet anticipated future consumer demand. As part of this investment, the company will pioneer a long-term study on oak tree sustainability on Brown-Forman distillery’s property.

In addition, the company declared a regular cash dividend of $0.1795 per share on the Class A and Class B common stock. Brown-Forman has paid regular quarterly cash dividends for 76 consecutive years and has increased the dividend for 37 consecutive years.


Fiscal Year 2021 Outlook

The company expects to continue to face uncertainty related to the evolving COVID-19 pandemic and its effect on the global economy. As a result, no quantitative guidance is being provided for fiscal year 2021. Jane Morreau, Executive Vice President and Chief Financial Officer, noted “While near-term uncertainty remains, we believe we are operating from a position of strength, and will emerge even stronger from this crisis, continuing to grow market share and drive long-term sustainable growth for all stakeholders.” Morreau added, “The company’s financial and business fundamentals have remained strong throughout the entire pandemic allowing us to deliver solid growth in this challenging environment.”


Conference Call Details

Brown-Forman will host a conference call to discuss these results at 10:00 a.m. (EST) today. All interested parties in the United States are invited to join the conference call by dialing 833-962-1472 and asking for the Brown-Forman call. International callers should dial +1-442-268-1255. The company suggests that participants dial in ten minutes in advance of the 10:00 a.m. (EST) start of the conference call. A live audio broadcast of the conference call, and the accompanying presentation slides, will also be available via Brown-Forman’s Internet website,, through a link to “Investors/Events & Presentations.” A digital audio recording of the conference call and the presentation slides will also be posted on the website and will be available for at least 30 days following the conference call.

For over 150 years, Brown-Forman Corporation has enriched the experience of life by responsibly building fine quality beverage alcohol brands, including Jack Daniel’s Tennessee Whiskey, Jack Daniel’s Tennessee RTDs, Jack Daniel’s Tennessee Honey, Jack Daniel’s Tennessee Apple, Jack Daniel’s Tennessee Fire, Gentleman Jack, Jack Daniel’s Single Barrel, Finlandia, Korbel, el Jimador, Woodford Reserve, Old Forester, Coopers’ Craft, Herradura, New Mix, Sonoma-Cutrer, Chambord, Benriach, GlenDronach, Glenglassaugh, Slane, and Fords Gin. Brown-Forman’s brands are supported by approximately 4,800 employees and sold in more than 170 countries worldwide. For more information about the company, please visit


Important Information on Forward-Looking Statements:

This press release contains statements, estimates, and projections that are “forward-looking statements” as defined under U.S. federal securities laws. Words such as “aim,” “anticipate,” “aspire,” “believe,” “can,” “continue,” “could,” “envision,” “estimate,” “expect,” “expectation,” “intend,” “may,” “might,” “plan,” “potential,” “project,” “pursue,” “see,” “seek,” “should,” “will,” “would,” and similar words indicate forward-looking statements, which speak only as of the date we make them. Except as required by law, we do not intend to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. By their nature, forward-looking statements involve risks, uncertainties, and other factors (many beyond our control) that could cause our actual results to differ materially from our historical experience or from our current expectations or projections. These risks and uncertainties include, but are not limited to:

  • Impact of health epidemics and pandemics, including the COVID-19 pandemic, and the resulting negative economic impact and related governmental actions
  • Risks associated with being a U.S.-based company with global operations, including commercial, political, and financial risks; local labor policies and conditions; protectionist trade policies, or economic or trade sanctions, including additional retaliatory tariffs on American spirits and the effectiveness of our actions to mitigate the negative impact on our margins, sales, and distributors; compliance with local trade practices and other regulations; terrorism; and health pandemics
  • Failure to comply with anti-corruption laws, trade sanctions and restrictions, or similar laws or regulations
  • Fluctuations in foreign currency exchange rates, particularly a stronger U.S. dollar
  • Changes in laws, regulatory measures, or governmental policies – especially those that affect the production, importation, marketing, labeling, pricing, distribution, sale, or consumption of our beverage alcohol products
  • Tax rate changes (including excise, sales, VAT, tariffs, duties, corporate, individual income, dividends, or capital gains) or changes in related reserves, changes in tax rules or accounting standards, and the unpredictability and suddenness with which they can occur
  • Unfavorable global or regional economic conditions, particularly related to the COVID-19 pandemic, and related economic slowdowns or recessions, low consumer confidence, high unemployment, weak credit or capital markets, budget deficits, burdensome government debt, austerity measures, higher interest rates, higher taxes, political instability, higher inflation, deflation, lower returns on pension assets, or lower discount rates for pension obligations
  • Dependence upon the continued growth of the Jack Daniel’s family of brands
  • Changes in consumer preferences, consumption, or purchase patterns – particularly away from larger producers in favor of small distilleries or local producers, or away from brown spirits, our premium products, or spirits generally, and our ability to anticipate or react to them; legalization of marijuana use on a more widespread basis; shifts in consumer purchase practices from traditional to e-commerce retailers; bar, restaurant, travel, or other on-premise declines; shifts in demographic or health and wellness trends; or unfavorable consumer reaction to new products, line extensions, package changes, product reformulations, or other product innovation
  • Decline in the social acceptability of beverage alcohol in significant markets
  • Production facility, aging warehouse, or supply chain disruption
  • Imprecision in supply/demand forecasting
  • Higher costs, lower quality, or unavailability of energy, water, raw materials, product ingredients, labor, or finished goods
  • Significant additional labeling or warning requirements or limitations on availability of our beverage alcohol products
  • Competitors’ and retailers’ consolidation or other competitive activities, such as pricing actions (including price reductions, promotions, discounting, couponing, or free goods), marketing, category expansion, product introductions, or entry or expansion in our geographic markets or distribution networks
  • Route-to-consumer changes that affect the timing of our sales, temporarily disrupt the marketing or sale of our products, or result in higher fixed costs
  • Inventory fluctuations in our products by distributors, wholesalers, or retailers
  • Risks associated with acquisitions, dispositions, business partnerships, or investments – such as acquisition integration, termination difficulties or costs, or impairment in recorded value
  • Counterfeiting and inadequate protection of our intellectual property rights
  • Product recalls or other product liability claims, product tampering, contamination, or quality issues
  • Significant legal disputes and proceedings, or government investigations
  • Cyber breach or failure or corruption of key information technology systems, or failure to comply with personal data protection laws
  • Negative publicity related to our company, products, brands, marketing, executive leadership, employees, board of directors, family stockholders, operations, business performance, or prospects
  • Failure to attract or retain key executive or employee talent
  • Our status as a family “controlled company” under New York Stock Exchange rules, and our dual-class share structure


For further information on these and other risks, please refer to our public filings, including the “Risk Factors” section of our annual report on Form 10-K and quarterly reports on Form 10-Q filed with the Securities and Exchange Commission.


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