Alcoholic Beverage manufacturer Brown-Forman Corp. (BF-B, BF-A) reported Wednesday a profit for the first quarter that increased 25 percent from last year, reflecting improved margins and revenue growth.
Earnings per share for the quarter topped analysts' expectations, while quarterly revenues missed their estimates. The company also reaffirmed its earnings and revenue growth guidance for the full-year 2013.
Brown-Forman, one of the largest American-owned spirits and wine companies and among the top 10 largest global spirits companies, sells its more than 35 brands in more than 160 countries.
Its brands include whiskey's Old Forester, Jack Daniel's, and Canadian Mist as well as Finlandia Vodka, Southern Comfort Liqueur, Sonoma-Cutrer wines, Don Eduardo Tequilas, and Korbel California Champagnes.
"Building from our strong fiscal 2012 results, Brown-Forman is off to a great start in fiscal 2013. Underlying net sales growth of 10% in the first quarter was driven by the continued strength of our Jack Daniel's trademark as well as improving results from other brands in our premium portfolio," CEO Paul Varga said in a statement.
The Louisville, Kentucky-based company reported net income of $147.5 million or $0.69 per share for the first quarter, higher than $118.1 million or $0.54 per share in the prior-year quarter.
On average, seven analysts polled by Thomson Reuters expected the company to report earnings of $0.62 per share for the first quarter. Analysts' estimates typically exclude special items.
The per share results are adjusted for the three-for-two stock split that occurred on August 10, 2012.
Net sales for the quarter increased 4 percent to $878.1 million from $840.3 million in the same quarter last year, but missed four Wall Street analysts' consensus estimate of $892.83 million. Underlying net sales grew 10 percent, and constant currency net sales increased 14 percent.
Underlying net sales outside of the U.S. grew 10 percent, increased 13 percent in the emerging markets, rose in the low single-digit percentage in Western European, and grew in double-digit percentage in Australia.
Among brands, Jack Daniel's trademark grew net sales 15 percent, Finlandia's family of brands increased net sales 20 percent and El Jimador family of brands advanced net sales 11 percent, while Southern Comfort's family of brands' net sales declined 1 percent.
Operating margin for the quarter expended 310 basis points to 25.2 percent from last year's 22.1 percent, as gross margin improved 290 basis points to 52.9 percent from last year.
Looking ahead to fiscal 2013, Brown-Forman continues to expect earnings in a range of $2.40 to $2.67 per share, adjusted for the three-for-two stock split, on projected high single-digit underlying sales growth. Street is currently looking for full-year 2013 earnings of $2.61 per share.
BF-A closed Tuesday's regular trading session at $60.54, down $0.21 on a volume of 2,500 shares, and BF-B closed at $62.78, up $0.23 on a volume of 0.23 million shares.
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