Brown-Forman released its full-year results on Wednesday

Brown-Forman released its full-year results on Wednesday

Back in 1966, when The Beatles were at their height, John Lennon famously remarked that the group was “more popular than Jesus”.

On Wednesday, after a stellar set of full-year results driven by outstanding growth for Jack Daniel's, Brown-Forman CEO Paul Varga channelled his inner Lennon. Flavoured whiskies in the US, Varga said, will be “larger than Scotch”

It didn't quite have the controversy of the earlier claim, but just as Lennon did before him, Varga has a point. 

The Jack Daniel's brand is benefitting from high global demand for North American whiskies with an underlying 8% sales jump across the year. The variant Tennessee Honey saw net sales up 32%.

Meanwhile, analysts believe there is still more to come from Jack Daniel's, mainly because of its flavours.

“We think global sales of Jack Daniel’s remain well below global potential and the company’s ability to exploit that potential, along with the potential of its other American whiskeys, is positive,” Stifel's Mark Swartzberg said in a note this week.

The “potential” word was also used by Nomura's Ian Shackleton, who said current levels of growth from the brand “look sustainable to us”.

This potential can be found in the latest Jack Daniel's extension, Tennessee Fire, which is on trial in three US states and was tagged by Varga in a call with analysts after Wednesday's results as ready for an expanded launch.

Brown-Forman has high hopes for the cinnamon-flavoured Fire, and if it can match the performance of Tennessee Honey, which is now the first flavoured whiskey to reach one-million cases, it will be another stand-out brand in what has become a red-hot category.

“The phenomenon of flavoured whiskeys in the US appears to be in its infancy,” Varga said. “But it is already driving some of the most explosive growth that we've seen in the spirits industry in years.”

Watch out Scotch. The heretics are at the temple gates.

*UPDATE - this article was amended on 9 June to reflect Paul Varga's view that flavoured whiskey could be larger than Scotch, but only in the US, not on global terms. We apologise for any confusion.