Brown-Forman (NYSE: BF.B) is expected to report their most recent quarterly earnings during a conference call scheduled for Wednesday morning. The company is projected to report an impressive year-over-year increase in earnings and higher revenues for its most recent quarter, which ended in April.
Brown-Forman is home to a diverse portfolio of brands including Jack Daniel’s Tennessee Whiskey, Woodford Reserve, El Jimador, Herradura tequila, Korbel, Chambord and more. It is among the largest American-owned wine and spirits companies as well as one of top 10 largest spirits companies globally.
Wednesday’s call with analysts will help to determine how well Brown-Forman’s ready-to-drink (RTD) products are performing as the hard seltzer and canned cocktail markets continue to expand.
Zacks Consensus Estimate expects Brown-Forman to report earnings of $0.30 per share for its Q4 2021, an 11.1% year-over-year improvement. Revenues for the beverage alcohol company are also expected to be up, estimated at $786.94 million, which would be an 11% increase from last year at this time. There has been no change in the company’s Consensus Earnings Per Share (EPS) Estimate for the last 30 days.
With venues across the country forced to close for much of last year as a result of quarantine regulations, alcohol companies struggled with on-premise beer and liquor sales. Some of the biggest companies in the industry, such as Anheuser-Busch (NYSE: BUD), Molson Coors Beverage Company (NYSE: TAP), and Boston Beer (NYSE: SAM), relied heavily on the success of their off-premise RTD selections to bridge the profit gap.
President and CEO of Brown-Forman, Lawson Whiting, expressed excitement about the success of the company’s RTD offerings during an earnings call in December of 2020.
“Another surprise has been the exceptional growth we’ve experienced in our RTD business,” Whiting said. “As I mentioned last quarter, we have believed in the ready-to-drink category ever since we launched our first Jack Daniel’s RTD over 25 years ago. But I’ll admit that this year’s performance has exceeded our expectations about the format and the category.”
Brown-Forman’s story began more than 150 years ago, when founder George Garvin Brown bottled his Old Forester Kentucky Straight Bourbon Whisky, making it the first bottled bourbon in the country. George Garvin Brown IV is current Chairman of the Board of Directors.
The company continued its legacy of innovation, launching one of the earliest modern RTD beverages in 1992, the Jack Daniel’s Country Cocktail. The bottled cocktail line, which features fruit flavors as well as a hint of Tennessee whiskey flavoring, still exists today and remains a popular choice for LDA consumers. The beverages are made with malt liquor and contain an ABV of 4.8%.
Jack Daniel’s Whiskey Cocktails
Last year, during the height of the pandemic, Jack Daniel’s launched its line of canned cocktails featuring real Jack Daniel’s whiskey. The cocktails come in three flavors including Whiskey & Cola and Whiskey & Seltzer, and Honey & Lemonade. The canned cocktails’ ABVs are either 5% (Whiskey & Seltzer) or 7% (Whiskey & Cola and Honey & Lemonade). Earlier this year Brown-Forman announced a distribution deal with Pabst Brewing making Pabst responsible for supplying and distributing all present and future Jack Daniel’s RTD beverages.
Jack Daniel’s isn’t the only Brown-Forman brand pushing RTD products. El Jimador’s New Mix canned cocktails are performing quite well in Mexico and Canada, the only countries where they are currently available. The cocktails contain real El Jimador tequila and come in five varieties including Margarita, Paloma, Paloma Mango Spicy, Vampiro and Paloma Light. Each flavor contains an ABV of 5%.
Last year Brown-Forman acquired Part Time Rangers, a two-year-old line of RTD canned cocktails from New Zealand. The cocktails feature real spirits and come in six flavors including Passionfruit Apple Vodka, Lime Vodka, Apple Lime Rum, Apple Lemon Gin, Strawberry Raspberry Gin, and Ginger Lime Whiskey. Each flavor contains an ABV of 6%.
Part Time Rangers is committed to wildlife conservation. Each cocktail flavor highlights an animal on the front of its can and 10% of the profits from that can go towards protecting the featured animal.
“…This really is not a single brand or single market phenomenon,” Whiting stated. “We’ve seen strong growth from our Jack Daniel’s RTDs in the markets like Australia, Germany and the UK…Our tequila-based RTDs called New Mix in Mexico, which is now near a record 8 million cases in the last 12 months. And since our last earnings call, we acquired Part Time Rangers, a range of low-calorie white spirit-based RTDs as a targeted investment that we believe will help us grow in this key category.”
All eyes will be on Brown-Forman’s RTD product lines this Wednesday. Investors are eager to learn just how well the company’s canned and bottled cocktails have performed.
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