Brown Forman Corp (BFA), a manufacturer of alcoholic beverages, has recorded a 4.90 percent increase in profit for the quarter ended Jul. 31, 2014. The company earned $150 million or $0.70 a share in the first-quarter compared with $143 million or $0.66 a share a year ago.
Revenue during the first-quarter went up marginally 2.79 percent to $921 million from $896 million in the last year period.
The company posted operating income of $221 million, compared with $217 million in the previous year period.
Paul Varga, the company's chief executive officer, said, ''As anticipated, our first quarter growth came in lower than what we achieved during fiscal 2014 and our expectations for fiscal 2015, due largely to pricing decisions that resulted in distributor and retail inventory reductions in the United States and Europe. We anticipate higher rates of sales growth over the balance of the year, led by Jack Daniel’s and our portfolio of premium whiskey brands. We reaffirm our full-year guidance and our expectations of 9-11% underlying operating income growth in fiscal 2015.''
Cash Flow
Brown Forman Corp has generated cash of $112 million from operating activities during the quarter, up 20.43 percent or $19 million when compared with the last year period.
The company has spent $31 million cash to meet investing activities during the quarter, as against cash outgo of $25 million in the last year period. It has made net capital expenditure of $31 million during the quarter, which was higher by 24 percent or $6 million, from a year ago.
The company's free cash flow accounted for 72.32 percent of operating cash flow for the quarter, compared with 73.12 percent in the last year period.
The company has spent $57 million cash to meet financing activities during the quarter, as against cash outgo of $51 million in the last year period. It has borrowed net of $5 million through debt during the quarter.
The company's cash dividend payment increased 14.81 percent or $8 million to $62 million. Dividend payment accounted for 55.36 percent of operating cash flow for the quarter, compared with 58.06 percent in the same period previous year.
As on Jul. 31, 2014, the company's cash balance stood at $460 million, up 111.98 percent or $243 million from Jul. 31, 2013.
Working Capital
Brown Forman Corp has witnessed an increase in the working capital over the last one year. The company's working capital stood at $1,622 million as at Jul. 31, 2014, up $276 million or 20.51 percent from $1,346 million on Jul. 31, 2013. It registered a decrease in current ratio to 3.55 as at Jul. 31, 2014 from 3.61 on Jul. 31, 2013.
Debt Position
Brown Forman Corp has witnessed an increase in the total debt over the last one year. As on Jul. 31, 2014, total debt stood at $1,011 million, up 0.80 percent or $8 million, from Jul. 31, 2013. The company's total debt was 24.12 percent of total assets as on Jul. 31, 2014, compared with 27.21 percent on Jul. 31, 2013.