Brown Forman Inc · NYSE:BF.A
Brown Forman — Q3 FY2023 Earnings Presentation
18 slides from Brown Forman's earnings presentation, Mar 8, 2023
Slide 1: Third Quarter and Year-to-Date Fiscal 2023 Results
Third Quarter and Year-to-Date Fiscal 2023 Results March 8, 2023
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation 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,” “exp
Slide 3: Year-to-Date Fiscal 2023 Highlights
Year-to-Date Fiscal 2023 Highlights Reported net sales growth of +8% (+12% organic1) Jack Daniel’s Tennessee Whiskey Woodford Reserve +6% reported net sales growth (+12% organic1) +34% reported net sales growth 1 (+35% organic ) Ready-to-Drink +12% reported net sales growth (+15% organic1) Reported
Slide 4: Year-to-Date Fiscal 2023 Results
Year-to-Date Fiscal 2023 Results Reported Reported Acquisitions and Impairment Foreign Organic Change1 ($ in millions, Change Divestitures Charges Exchange except per share (%) (+/-) (+/-) (+/-) (%) amount) Net Sales $3,182 8% —% —% 4% 12% Gross Profit $1,859 5% —% —% 6% 11% Advertising $372 20% —%
Slide 5: Net Sales Across Brands
Year-to-Date Fiscal 2023 Net Sales Across Brands 1 REPORTED ORGANIC 9% 14% Whiskey Whiskey 10% 15% Jack Daniel’s Family 5% Jack Daniel’s Family 11% of Brands 12% of Brands 14% Jack Daniel’s 6% Jack Daniel’s 12% Tennessee Whiskey 17% Tennessee Whiskey 20% 33% 34% Premium Bourbons Premium Bourbons 10%
Slide 6: Net Sales Across Geographic Clusters
Year-to-Date Fiscal 2023 Net Sales Across Geographic Clusters U.S. DEVELOPED REPORTED ORGANIC1 REPORTED ORGANIC1 CHANGE CHANGE CHANGE CHANGE 8% 15% 12% 13% 4% 5% 4% 5% FY23 FY22 FY23 FY22 FY23 FY22 FY23 FY22 EMERGING REPORTED ORGANIC1 GLOBAL REPORTED ORGANIC1 CHANGE CHANGE TRAVEL RETAIL CHANGE CHANG
Slide 7: Year-to-Date Fiscal Year 2023 Gross Margin
Year-to-Date Fiscal Year 2023 Gross margin decreased 170 basis points driven by inflation, supply chain disruption costs and foreign exchange, partially offset by removal of tariffs and favorable price/mix. 60.1% 1.7% 0.1% 58.4% 2.0% (1.2)% (4.3)% YTD FY22 Cost Price/Mix Removal of Acquisitions & Fo
Slide 8: Updated Fiscal 2023 Outlook
Updated Fiscal 2023 Outlook Organic1 net sales growth now expected to be in the 8% to 10% range. Continue to expect reported gross margin to be consistent with the first half of fiscal 2023. Still anticipate high-single digit organic1 operating income growth. Continue to expect full year effective t
Slide 9: Appendix
Appendix NOTHING BETTER IN THE MARKET. @ BROWN-FORMAN 9
Slide 10: Non-GAAP Financial Measures and Reconciliation
Non-GAAP Financial Measures and Reconciliation Use of Non-GAAP Financial Information.We use some financial measures in this presentation that are not measures of financial performance under U.S. generally accepted accounting principles (GAAP). These non-GAAP measures, defined below, should be viewed
Slide 11: Non-GAAP Financial Measures and Reconciliation (continued)
Non-GAAP Financial Measures and Reconciliation (continued) • “Foreign exchange.” We calculate the percentage change in certain line items of the statements of operations in accordance with GAAP and adjust to exclude the cost or benefit of currency fluctuations. Adjusting for foreign exchange allows
Slide 12: Definitions
Definitions From time to time, to explain our results of operations or to highlight trends and uncertainties affecting our business, we aggregate markets according to stage of economic development as defined by the International Monetary Fund (IMF), and we aggregate brands by beverage alcohol catego
Slide 13: Definitions (continued)
Definitions (continued) • “Tequila” includesthe Herradura family of brands (Herradura), el Jimador, and other tequilas. • “Wine” includes Korbel California Champagne and Sonoma-Cutrer wines. • “Vodka” includes Finlandia. • “Rest of Portfolio” includes Chambord, Korbel Brandy, Fords Gin, Gin Mare, an
Slide 14: Definitions (continued)
Definitions (continued) Other Metrics. • “Shipments.” We generally record revenues when we ship or deliver our products to our customers. In this document, unless otherwise specified, we refer to shipments when discussing volume. • “Depletions.” This is a term commonly used in the beverage alcohol i
Slide 15: Year-to-Date Fiscal 2023 Results Reconciliation
Year-to-Date Fiscal 2023 Results Reconciliation Acquisitions & Impairment Charges Foreign Exchange Nine months ended January 31, 2023 Reported Organic Divestitures (+/-) (+/-) (+/-) Net Sales 8% —% —% 4% 12% Gross Profit 5% —% —% 6% 11% Advertising Expense 20% —% —% 5% 24% SG&A Expense 9% (2)% —% 4%
Slide 16: Brand Reconciliation - Net Sales Growth
Brand Reconciliation - Year-to-Date Fiscal 2023 Net Sales Growth Acquisitions & Nine months ended January 31, 2023 Reported Foreign Exchange (+/-) Organic Divestitures (+/-) Whiskey 9% —% 5% 14% Jack Daniel’s Family of Brands 5% —% 6% 11% Jack Daniel’s Tennessee Whiskey 6% —% 6% 12% Premium Bourbons
Slide 17: Geographic Reconciliation - Year-to-Date Fiscal 2023
Geographic Reconciliation - Year-to-Date Fiscal 2023 Acquisitions & Nine months ended January 31, 2023 Reported Foreign Exchange (+/-) Organic Divestitures (+/-) United States 4% —% —% 4% Developed International 5% -1% 9% 13% Emerging 18% —% 8% 26% Travel Retail 48% (2)% 5% 52% Acquisitions & Nine m
Slide 18: Brown-Forman
@) BROWN-FORMAN