(Reuters) – Brown-Forman beat second-quarter sales and profit estimates on Thursday, helped by steady demand for its ready-to-drink beverages and spirits.
Shares of the company, which has dropped nearly 28% so far this year, rose about 6% before the bell.
The company’s famed whiskey products including Woodford Reserve and Old Forester saw sales grow based on brand strength and popularity among consumers with expendable income.
The resurgence in popularity of its Jack Daniel’s Tennessee Whiskey, along with an increase in distributor inventories also helped the company beat sales estimates after three consecutive quarters of decline.
However, the company has been plagued by high input costs, especially for ingredients such as agave for its Tequila products, which have offset the benefits of the premium pricing, causing the quarterly gross margin to fall by 8%.
Brown-Forman posted a net income of $258 million, or 55 cents per share, for the quarter, compared with $242 million, or 50 cents, a year earlier. Analysts on average estimated it to earn 49 cents per share, according to data compiled by LSEG.
For the second quarter, the company posted net sales of $1.10 billion, compared with analysts’ average estimate of $1.08 billion.
The company also reiterated its organic sales growth forecast for fiscal 2025 to be in the range of a 2% to 4% rise.
(Reporting by Neil J Kanatt in Bengaluru; Editing by Vijay Kishore)
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