Financial Performance - For the three months ended October 31, 2023, net sales were $1,107 million, a slight increase from $1,094 million for the same period last year, representing a growth of 1.2%[45] - Diluted earnings per share for the three months ended October 31, 2023, increased by 6% to $0.50, compared to $0.47 for the same period last year[29] - Operating income for the three months ended October 31, 2023, was $339 million, compared to $313 million for the same period last year, reflecting an increase of 8.3%[45] - Comprehensive income for the three months ended October 31, 2023, was $229 million, compared to $151 million for the same period last year, indicating a significant increase[47] - Net income for the three months ended October 31, 2023, was $473 million, slightly down from $476 million in the same period last year, a decrease of 0.63%[55] - Basic earnings per share for the three months ended October 31, 2023, was $0.50, compared to $0.99 for the same period last year, a decrease of 49.50%[60] - Total net sales for the six months ended October 31, 2023, reached $2,145 million, compared to $2,101 million for the same period in 2022, reflecting a growth in both developed and emerging markets[70] - Reported net sales for the six months ended October 31, 2023, were $2.1 billion, an increase of 2% compared to the same period last year, driven by favorable price/mix and recently acquired brands[168] Tax and Legal Matters - The effective tax rate for the six months ended October 31, 2023, was 22.4%, down from 23.7% for the same period last year, primarily due to decreased state taxes and lower tax contingencies[28] - The effective tax rate for the six months ended October 31, 2023, was 22.4%, higher than the expected rate of 21.7% but lower than 23.7% for the same period last year[74] - The company does not anticipate any pending legal proceedings to have a material adverse effect on its financial position or results of operations[24] Shareholder Actions - The company repurchased 750,879 shares at an average price of $56.04 during the quarter ended October 31, 2023, with an approximate dollar value of shares yet to be purchased under the plans amounting to $357.9 million[26] - Cash dividends declared per share for Class A and Class B common stock increased from $0.2055 to $0.2178, effective January 2, 2024[69] Assets and Liabilities - Total assets increased from $7,777 million on April 30, 2023, to $8,115 million on October 31, 2023, representing a growth of 4.35%[51] - Total current assets rose from $3,801 million to $4,273 million, an increase of 12.39%[51] - Total liabilities decreased from $4,661 million to $4,509 million, a reduction of 3.25%[51] - Long-term debt as of October 31, 2023, totaled $2,654 million, with short-term borrowings under the commercial paper program increasing to $457 million from $235 million as of April 30, 2023[65] - Stockholders' equity increased to $3,454 million as of October 31, 2023, up from $3,268 million at April 30, 2023, driven by net income of $231 million and $242 million for the respective periods[67] Cash Flow - Cash provided by operating activities decreased significantly from $316 million in October 2022 to $97 million in October 2023, a decline of 69.36%[55] - The company reported a net increase in cash and cash equivalents from $874 million at the beginning of the period to $1,087 million at the end, an increase of 24.38%[55] Inventory and Sales - The company’s inventories rose from $2,283 million to $2,585 million, an increase of 13.23%[51] - Whiskey sales for the three months ended October 31, 2023, were $739 million, a decrease of 2% from $754 million in the same period of 2022[78] - Ready-to-Drink product sales increased by 8.2% to $132 million for the three months ended October 31, 2023, compared to $122 million in the same period of 2022[78] Acquisitions and Divestitures - The company completed the sale of its Finlandia vodka business for $194 million in cash on November 1, 2023[127] - An agreement was reached to sell the Sonoma-Cutrer wine business for $50 million in cash and a 21.5% ownership stake in The Duckhorn Portfolio, expected to close in Q4 fiscal 2024[128] - The purchase price for the Gin Mare acquisition was $523 million, which included $468 million in cash and $55 million in contingent consideration[113] - The Diplomático acquisition had a purchase price of $723 million, net of a post-closing working capital adjustment of $4 million[116] Market Risks and Management - There have been no material changes to the market risks faced by the company or its risk management program since April 30, 2023[19] - There have been no material changes to the risk factors disclosed in the 2023 Form 10-K, indicating stability in the company's risk environment[25] Non-GAAP Measures - The company uses non-GAAP measures to provide a clearer understanding of its financial performance, adjusting for acquisitions, divestitures, and foreign exchange[131]
Brown-Forman(BF_A) - 2024 Q2 - Quarterly Report