LOUISVILLE, Ky. (AP) - Brown-Forman, the maker of Jack Daniel's Tennessee Whiskey, reported a sharp decline in fourth-quarter earnings Wednesday due to the strong dollar and its sale of the Southern Comfort brand.
Jack Daniel sales were strong, as were sales of tequila and Woodford Reserve bourbon.
The company said it expects earnings per share in the range of $1.80 to $1.90 next year, based on sales growth of 4 percent to 5 percent.
But it warned that the global economy remains volatile, especially in emerging markets, and there is rising competition in developed markets.
"Given the acceleration we experienced in the second half of the year, the investments we continue to make behind the business, and the expectation of improved contribution from innovation next year, we are forecasting another strong year in fiscal 2018," CEO Paul Varga said.
Brown-Forman Corp. reported net income of $144 million, or 37 cents per share, in the fourth quarter ending April 30. That's compared with $522 million, or $1.30 per share, a year ago.
Quarterly net sales minus excise taxes fell 5 percent, to $694 million.
For the full year, net income was $669 million, or $1.71 per share, compared with $1.07 billion, or $2.61 per share, a year ago. Net sales after excise taxes were off 3 percent.
The company's just-ended fiscal year was effected by the sale of its Southern Comfort and Tuaca brands and the strength of the dollar. Foreign markets account for slightly more than half of all sales for the Louisville, Kentucky, company.
Brown-Forman sold Southern Comfort and Tuaca, a premium liqueur brand, to Sazerac last year. It booked a large gain from that sale during the same period last year, creating a disparity when compared with this year's final quarter.
Inventory fluctuations were another factor. Wholesalers had less inventory on hand than a year ago, meaning they purchased less of the company's products. Brown-Forman believes that situation is temporary.
The company pointed to strong, sustained sales for many core brands.
Underlying net sales for the year grew 4 percent in both the U.S. and its overseas markets. In emerging markets, those sales grew by 8 percent in the second half of the year, after a 1 percent decline in the first half.
Underlying net sales for the entire Jack Daniel's lineup rose 3 percent for the year. Woodford Reserve had a 19 percent gain, while Herradura was up 14 percent and el Jimador increased 8 percent.
Finlandia vodka had a 1 percent drop, while Canadian Mist had a 12 percent decline.
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Part of this story was generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on BF.A at https://www.zacks.com/ap/BF.A
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Keywords: Brown-Forman, Earnings Report