Brown Forman Financial Analysis

Topics: Balance sheet / Pages: 33 (8188 words) / Published: May 15th, 2011
Brown-Forman Corporation

Case Analysis

The Company

George Garvin Brown, a pharmaceutical salesman who had the idea to serve bourbon in sealable glass bottles, originally founded company in 1870. The brand that George started was originally known as Old Forester Kentucky Straight Bourbon Whiskey, which became America’s first bottled bourbons, remains one of the best selling brands 140 years later. The company has expanded however; the Brown’s have stayed with the firm for five generations, as George Garvin Brown IV serves as the Presiding Chairman of the Board.

Today, Brown-Forman has developed into a leader in the wine and spirits industry. Based out of Louisville Kentucky, this US based firm sells its brands in 135 different countries producing more than 35 alcohol brands, which include Southern Comfort, Korbel, Canadian Mist, and Fetzer. The most important brand in its portfolio is Jack Daniels, which is not only the largest selling American whiskey according to volume, but also the fourth largest premium spirits brand sold in the world. According to Mergent online, Brown-Forman’s 2009 total revenue was $2.481 billion with approximately 3,800 employees on staff. Brown-Forman is the largest American based firm in its class of wine and spirit distributors.

As shown in the graph below Brown-Forman has many different segments, the most successful of which is their Jack Daniel’s line. The second best producing segment is their wines, which represents almost one-fourth of revenues. One of the area’s Brown-Forman has branched off into is the area of RTD’s. As a method of creating new products and increasing sales Brown-Forman has been trying to stay on top by developing innovative mixed drinks that are ready to drink. This category represents 12% of the revenue. Liqueurs and cordials represent 9% of the revenue; this is one of the least known segments that Brown-Forman operates. The rest of its alcohols make up the remaining 26%, mostly comprised of



Bibliography: 1) Brown-Forman Annual Report. (2009). Retrieved from http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MzQyMjA5fENoaWxkSUQ9MzI4ODk1fFR5cGU9MQ Accessed March 14, 2010 2) Issue: READY-TO-DRINKS. (2009, July 07). Retrieved from http://www.ourthinkingaboutdrinking.com/Default.aspx Accessed March 14, 2010 3) ALAC’s policy on ready-to-drinks (rtds). (2008, September). Retrieved from www.alcohol.org.nz/PoliciesAndSubmissions.aspx Accessed March 14, 2010 ----------------------- [1] http://www2.potsdam.edu/hansondj/Controversies/1116895242.html [2] Brown-Forman Annual Report [3] Brown-Forman Issues Website [4] Alcohol Advisory Council of New Zealand

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