US: Wine divestment drags on profits but sales climb in Brown-Forman FY

• FY reported net profits slip by 10% to US$513.2m
• Net sales for year to end of April rise by 6% to $3.61bn
• Operating profits also fall, by 8% to $788.4m
• But, underlying operating profits return to pre-2008 levels

Brown-Forman has toasted a healthy lift in net sales and "underlying" operating profits, as fiscal 2012 returned to "pre-2008 levels".

The US-based spirits firm, which sold off its Californian wine interests to Concha y Toro in March last year, said earlier today (6 June) that operating profits in the year to the end of April rose on an underlying basis by 9% year-on-year. The wine sale, which netted Brown-Forman US$238m, pulled down net profits for the year, however, by 10% to $513.2m.

Sales for the 12-month period were up by 6% year-on-year to $3.61bn.

For the final quarter to the end of April, net profits dropped by 37% to $104.5m, with net sales holding steady, up by 1% to $801.3m. Operating profits also struggled with the loss of the wine unit, dropping by 32% to $150.1m.

“Our strong performance was broad-based, with each of our 12 largest markets growing net sales in fiscal 2012,” said company CEO Paul Varga.

“As an industry leader in American whiskey, we are encouraged by the category’s momentum in the US and around the world. Aided by super-premium line extensions, flavoured expressions, and RTD innovation, the category’s growing popularity bodes well for Brown-Forman and our stable of leading trademarks.”

Looking forward, Varga added: "While the economic backdrop remains uncertain, we expect that this strength in underlying sales will continue into fiscal 2013, with anticipated growth in the high single-digits."

To read the company's official statement, click here.