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Oct 31, 2024
Brown-Forman Q2 2025 Earnings Report
Brown-Forman reported mixed results for Q2 2025, with net sales decreasing slightly but EPS increasing, and reaffirmed its full-year growth outlook.
Key Takeaways
Brown-Forman reported a slight decrease in net sales for the second quarter of fiscal 2025, but diluted earnings per share increased. The company reaffirmed its full-year growth outlook, anticipating a return to growth driven by international markets and normalizing inventory trends.
Second quarter net sales decreased by 1% to $1.1 billion, but increased 3% on an organic basis.
Second quarter operating income increased 1% to $341 million, with a 5% increase on an organic basis.
Diluted earnings per share for the second quarter increased 9% to $0.55.
The company reaffirms its fiscal 2025 outlook, expecting organic net sales and operating income to grow in the 2% to 4% range.
Brown-Forman
Brown-Forman
Forward Guidance
Brown-Forman anticipates a return to growth for organic net sales and organic operating income in fiscal 2025, driven by gains in international markets and the benefit of normalizing inventory trends. This outlook is tempered by the belief that global macroeconomic and geopolitical uncertainties will continue to create a challenging operating environment.
Positive Outlook
- Organic net sales growth in the 2% to 4% range.
- Organic operating income growth in the 2% to 4% range.
- Gains in international markets.
- Benefit of normalizing inventory trends.
- An effective tax rate to be in the range of approximately 21% to 23%.
Challenges Ahead
- Global macroeconomic uncertainties.
- Geopolitical uncertainties.
- Challenging operating environment.
- Potential impact of distributor inventories.
- Fluctuations in foreign currency exchange rates.