Printer Friendly

BROWN-FORMAN REPORTS FIRST QUARTER EARNINGS; ASSESSES IMPACT OF TAX HIKE

 LOUISVILLE, Ky., Aug. 23 /PRNewswire/ -- Brown-Forman Corporation (NYSE: BF.A BF.B) reported net income for the quarter ended July 31, 1993, before a noncash charge related to the adoption of new accounting standards, of $29.4 million or $1.06 per share compared to $35.2 million or $1.27 per share last year. The one-time charge related to the adoption of new accounting standards dealing with postretirement and postemployment benefits reduced earnings by $28.4 million or $1.03 per share, resulting in net income of $1.0 million or $.03 per share for the quarter. Net sales for the period declined 2 percent to $390 million.
 Owsley Brown II, who succeeded W.L. Lyons Brown, Jr. as Chief Executive Officer at the company's annual stockholders' meeting in July, cited an unusually strong first quarter last year in assessing lower operating results. "Last year's earnings were boosted $.14 per share from advance shipments of Jack Daniel's to overseas markets and imports of wines into the U.S. as a protective measure against a potential trade dispute between the United States and the European Community. Results last year also benefited from very strong


introductory sales of Jack Daniel's Country Cocktails caused by high rates of consumer trial and the establishment of trade inventories."
 Sales of the company's wines and spirits segment declined 3 percent for the quarter, largely reflecting last year's advance shipments related to the trade dispute as well as significantly lower sales of Jack Daniel's Country Cocktails this summer. While first quarter sales were boosted by the addition of Fetzer Vineyards, acquired by Brown- Forman in August 1992, sales trends for Brown-Forman's major beverage brands slowed from volume rates experienced the previous fiscal year.
 Sales of consumer durables rose 1 percent compared to last year. Core Lenox china and crystal sales were up for the quarter, reflecting several successful new product introductions. Weak market conditions continued to depress operating results for Lenox retail stores, however, where same-store sales were down from last year.
 Mr. Brown stated that the company's second quarter earnings will be reduced by approximately $.16 per share as a result of the recently enacted tax legislation signed into law August 10. The additional second quarter tax expense will recognize the effect of a higher tax rate on earnings since January 1, as well as the recording of a noncash charge to restate Brown-Forman's deferred tax liability at the new corporate tax rate. Mr. Brown added that improved earnings for the last half of the year are expected to result in moderate full-year earnings growth for Brown-Forman, excluding the charge relating to new accounting standards and the effects of new tax legislation.
 Brown-Forman is a diversified producer and marketer of fine quality consumer products, including Jack Daniel's Tennessee Whiskey, Canadian Mist, Southern Comfort, Early Times, Jack Daniel's Country Cocktails, Korbel California Champagnes, Bolla Italian Wines, Fetzer Vineyard California Wines, Lenox China and Crystal, Dansk International Designs, Gorham Silver, Crystal and China, and Hartmann Luggage.
 BROWN-FORMAN CORPORATION
 LOUISVILLE, KENTUCKY
 CONSOLIDATED STATEMENT
 (Expressed in thousands except per share amounts)
 THREE MONTHS ENDED
 JULY 31,
 1993 1992
 Net Sales $389,655 397,114
 Operating Income $ 48,377 56,176
 Income Before Income Taxes $ 45,416 54,153
 Taxes on Income $ 15,962 18,955
 Income Before Cumulative Effect
 of Changes in Accounting Principles (A) $ 29,454 35,198
 Cumulative Effect of Changes in
 Accounting Principles (A) $ 28,442 --
 Net Income $ 1,012 35,198
 Earnings Per Share of Common Stock:
 Earnings Before Cumulative Effect of
 Changes in Accounting Principles (A) $ 1.06 1.27
 Cumulative Effect of Changes in
 Accounting Principles (A) $ 1.03 --
 Net Earnings $ .03 1.27
 Average Shares of Common Stock 27,555 27,555
 Net Sales Less Excise Tax $322,456 326,436
 NOTE: (A) On May 1, 1993, the company adopted Statements of Financial Accounting Standards No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions," and No. 112, "Employers' Accounting for Postemployment Benefits." The adoption of these standards resulted in a pretax charge totaling $46,501,000 ($28,442,000 or $1.03 per share after-tax.) The charge to net income from adopting these accounting standards was recorded as the cumulative effect of changes in accounting.
 These figures have been prepared in accordance with the company's customary accounting practices and have not been audited.
 -0- 8/23/93
 /CONTACT: Larry Probus, Vice President, Brown-Forman, 502-774-7441/
 (BF)


CO: Brown-Forman Corporation ST: Kentucky IN: FOD SU: ERN

SB -- CH006 -- 5142 08/23/93 15:44 EDT
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Aug 23, 1993
Words:752
Previous Article:ROPER INDUSTRIES ANNOUNCES RECORD THIRD QUARTER RESULTS, STOCK SPLIT AND DIVIDEND INCREASE
Next Article:CIPSCO REPORTS EARNINGS ENDING JULY 31, 1993
Topics:

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters