Brown-Forman Shareholders Hold Annual Meeting (2009)
Louisville, KY, July 23, 2009 – At their annual meeting today, Brown-Forman stockholders elected directors for the coming year and re-approved the performance measures under the Brown-Forman 2004 Omnibus Compensation Plan.
In his remarks to shareholders, Presiding Board Chairman Geo. Garvin Brown IV thanked former directors Barry Bramley, Donald Calder, and Matthew Simmons, all of whom retired since the 2008 annual meeting, for their many contributions to the company and acknowledged John Cook, a new independent director attending his first meeting of shareholders.
Brown-Forman Chief Executive Officer Paul Varga told shareholders that considering the global economic recession, the company performed well in fiscal 2009. “We were pleased with our underlying growth in fiscal 2009,” stated Varga. “Additionally, our nearly 16% rate of return on invested capital for the year surpassed our industry competitors,” Varga said, “and the company’s total shareholder return, with dividends reinvested, outperformed the S&P 500 index over one-, five-, 10-, and 15-year periods.”
Shareholders elected the following individuals to the Brown-Forman board of directors: Patrick Bousquet-Chavanne; Geo. Garvin Brown IV; Martin S. Brown, Jr.; John D. Cook; Sandra A. Frazier; Richard P. Mayer; William E. Mitchell; William M. Street; Dace Brown Stubbs; Paul C. Varga; and James S. Welch, Jr.
In a subsequent meeting, the board of directors approved a regular quarterly cash dividend of $0.2875 cents per share on Class A and Class B Common Stock. Stockholders of record on September 8, 2009, will receive the cash dividend on October 1, 2009. With this dividend, Brown-Forman will have paid regular quarterly cash dividends for 64 consecutive years.
Additionally, at the recommendation of management, the board decided not to increase compensation for the company’s named executive officers or directors in fiscal 2010, as part of the cost-cutting measures the company has taken to address the current global economic recession.
Brown-Forman Corporation is a producer and marketer of fine quality beverage alcohol brands, including Jack Daniel’s, Southern Comfort, Finlandia, Canadian Mist, Fetzer, Korbel, Gentleman Jack, el Jimador, Tequila Herradura, Sonoma-Cutrer, Chambord, Tuaca, Woodford Reserve, and Bonterra.
Important Information on Forward-Looking Statements:
This report contains statements, estimates, and projections that are “forward-looking statements” as defined under U.S. federal securities laws. Words such as “expect,” “believe,” “intend,” “estimate,” “will,” “may,” “anticipate,” “project,” and similar words identify 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 other factors include, but are not limited to:
• deepening or expansion of the global economic downturn or turmoil in financial and equity markets (and related credit and capital market instability and illiquidity; decreased consumer and trade spending; higher unemployment; supplier, customer or consumer credit or other financial problems; further inventory reductions by distributors, wholesalers, or retailers; bank failures or governmental nationalizations, etc.)
• competitors’ pricing actions (including price promotions, discounting, couponing or free goods), marketing, product introductions, or other competitive activities aimed at our brands
• trade or consumer reaction to our product line extensions or new marketing initiatives
• further decline in consumer confidence or spending, whether related to global economic conditions, wars, natural disasters, pandemics (such as swine flu), terrorist attacks or other factors
• increases in tax rates (including excise, sales, corporate, individual income, dividends, capital gains), changes in tax rules (e.g., LIFO, foreign income deferral, U.S. manufacturing deduction) or accounting standards, tariffs, or other restrictions affecting beverage alcohol, and the unpredictability and suddenness with which they can occur
• trade or consumer resistance to price increases in our products
• tighter governmental restrictions on our ability to produce and market our products, including advertising and promotion
• business disruption, decline or costs related to reductions in workforce or other cost-cutting measures
• lower returns on pension assets, higher interest rates on debt, or significant changes in recent inflation rates (whether up or down)
• fluctuations in the U.S. dollar against foreign currencies, especially the British pound, euro, Australian dollar, or Polish zloty
• reduced bar, restaurant, hotel and other on-premise business; consumer shifts to discount stores to buy our products; or other price-sensitive consumer behavior
• changes in consumer preferences, societal attitudes or cultural trends that result in reduced consumption of our products
• distribution arrangement changes that affect the timing of our sales or limit our ability to market or sell our products
• adverse impacts resulting from our acquisitions, dispositions, joint ventures, business partnerships, or portfolio strategies
• lower profits, due to factors such as fewer used barrel sales, lower production volumes (either for our own brands or those of third parties), or cost increases in energy or raw materials, such as grapes, grain, agave, wood, glass, plastic, or closures
• Climatic changes, agricultural uncertainties, our suppliers’ financial hardships or other factors that reduce the availability or quality of grapes, agave, grain, glass, closures, plastic, or wood
• negative publicity related to our company, brands, personnel, operations, business performance or prospects
• product counterfeiting, tampering, or contamination and resulting negative effects on our sales, brand equity, or corporate reputation
• adverse developments stemming from state, federal or other governmental investigations of beverage alcohol industry business, trade, or marketing practices by us, our distributors, or retailers
• impairment in the recorded value of inventory, fixed assets, goodwill or other intangibles