) fiscal fourth-quarter 2013 (ended Apr 30, 2013) earnings of 52
cents a share came in ahead of the Zacks Consensus Estimate of 46
cents. Moreover, earnings increased 6.1% from 49 cents reported
in the year-ago quarter.
Net sales increased 8% year over year to $866 million
primarily due to strong demand of whiskey across all regions in
which the company operates. On an underlying basis, the company's
net sales increased 7%. Moreover, the quarterly sales were well
above the Zacks Consensus Estimate of $646 million.
During the quarter, Brown-Forman's gross profit increased 9%
to $460 million from $422 million reported in the year-ago
quarter. Gross margin expanded 44 basis points (bps) to 53.12%
compared with 52.68% in the prior-year period, primarily due to
lower excise taxes as a percentage of sales.
Selling, general and administrative expenses (SG&A)
increased 3% from the year-ago quarter to $180 million, while
SG&A as a percentage of sales contracted 106 basis points to
20.79%. Advertising expenses remained flat year over year at $99
Operating profit during the quarter climbed 18% to $177
million from $150 million in the prior-year period.
Operating margin expanded 201 bps to 20.44% compared with
18.73% in the year-ago quarter primarily driven by improved gross
profit margin, benefiting from lower SG&A and advertising
Balance Sheet & Cash Flow
Brown-Forman, which has a Zacks Rank #2 (Buy), ended the
quarter with cash and cash equivalents of $204 million and
long-term debt of $997 million. During the quarter, Brown-Forman
generated $537 million of cash from operations and deployed
$1,063 million toward dividend payout.
Fiscal 2014 Guidance
Going forward, Brown-Forman expects fiscal 2014 earnings in
the range of $2.80-$3.00 per share. Moreover, the company
projects operating income to increase in the range of 9%-11%,
while underlying sales are expected to rise in the
Other Stocks to Consider
Other stocks worth considering in the beverages-alcohol
Grupo Modelo, S.A.B. de C.V.
Constellation Brands Inc
). All these stocks hold a Zacks Rank #2 (Buy).
BROWN FORMAN B (BF.B): Free Stock Analysis
DIAGEO PLC-ADR (DEO): Free Stock Analysis
GRUPO MODELO-C (GPMCF): Get Free Report
CONSTELLATN BRD (STZ): Free Stock Analysis
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