Brown-Forman Corp Class B BF.B
Q2 2013 Earnings Call Transcript

Transcript Call Date 12/05/2012

Operator: Good morning, my name is Tiffany and I will be your conference operator today. At this time, I would like to welcome everyone to the Second Quarter Fiscal 2013 Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Thank you.

I would now like to turn the conference over Jay Koval. Please go ahead.

Jason Koval - Director of IR: Thanks, Tiffany and good morning, everyone. I want to thank you for joining us today for Brown-Forman's 2013 second quarter earnings call. Joining me today are, Paul Varga, our President and Chief Executive Officer, Don Berg, Executive; Don Berg, Executive Vice President and Chief Financial Officer; and Jane Morreau, Senior Vice President of Finance.

This morning's conference call contains forward-looking statements based on our current expectations. Numerous risks and uncertainties may cause actual results to differ materially from those anticipated or projected in these statements. Many of the factors that will determine future results are beyond the Company's ability to control or predict. You should not place undue reliance on any forward-looking statements and the Company undertakes no obligation to update any of these statements whether due to new information future events or otherwise.

This morning we issued a press release containing our results for the fiscal 2013 second quarter. The release can be found on our website under the section titled Investor Relations. In the press release we have listed a number of the risk factors that you should consider in conjunction with our forward-looking statements. Other significant risk factors are described in our Form 10-K, 8-K and 10-Q reports filed with the Securities and Exchange Commission. During this call we will be discussing certain non-GAAP financial measures. These measures and the reasons management believes they provide useful information to investors regarding the company's financial conditions and results of operations are contained in the press release.

With that I will turn the call over to Don for his prepared remarks.

Don Berg - EVP and CFO: Thanks, Jane and good morning. On today second quarter earnings call I plan on covering three topics. I'll start with a review of our first half results followed by a quick update on the pricing environment and I'll close with our revised outlook for fiscal 2013.

So, let me start with my first topic a review of our first half results. We are pleased to report first half underlying sales growth of 8%. Remember that on our last quarterly call we estimated that retail buy-ins likely contributed a point or two to our rate of underlying sales growth of 10% in the first quarter. The second quarter saw the expected reversal of some of these buy-ins, reducing underlying sales growth to 6%. Putting the two quarters together, for the first half underlying sales came in at 8%, in line with our high single digit full-year outlook. We believe our underlying net sales result outperforms spirits industry averages in large part due to our skew to premium brands and our portfolios focus on faster growing categories, such as North American Whiskey.

Read our Earnings Call Transcript disclaimer.
Add a Comment
E-mail me new replies.