Jack Daniel's Maker to Hike Prices

Industrials Reuters

Jack Daniel's parent Brown-Forman Corp reported a weaker-than-expected quarterly profit on Wednesday and narrowed its full-year forecast, hurt by weak sales and margin pressure.

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But the company, whose pricing power was hurt in the recession's aftermath, said the time was becoming right for price increases, as a fragile recovery was leading some consumers to again buy premium alcoholic drinks.

Shares of Brown-Forman, which also makes Finlandia vodka and Southern Comfort flavored whiskey, were down less than 1 percent at $79.59 in morning trading.

Net income fell to $133.1 million, or 93 cents per share, in the company's fiscal third quarter that ended on Jan. 31, from $140.7 million, or 96 cents per share, a year earlier.

Net sales slipped 0.4 percent to $959 million.

Analysts on average were expecting earnings of $1 per share and sales of $1 billion, according to Thomson Reuters I/B/E/S.

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But excluding the impact of items such as currency exchange and its exit from a wine business, sales rose 7 percent.

Brown-Forman cited strong gains in the German, Russian and Canadian markets, compared with weaker performances in markets such as China and Greece.

The company said it now expects full-year earnings of $3.50 to $3.65 per share, compared with a prior forecast of $3.45 to $3.70 per share. Analysts on average had been expecting $3.65 per share.

For the current fourth quarter, the company said it expects high single-digit growth in net sales and operating income.

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