March 4 (Reuters) - Jack Daniel's maker Brown-Forman on Wednesday beat analysts' expectations for third-quarter sales and profit on the back of firm demand for its whiskey and ready-to-drink beverages despite a choppy economic backdrop.
Shares of the company, which also maintained its annual forecasts, were up 3% in early trading.
The Kentucky-based company over the last year turned to product innovation, cost-control measures and streamlined operations, and has accelerated expansion in emerging markets to offset weakness in its key U.S. spirits business.
It enjoyed resilient demand for its premium whiskey offerings such as Jack Daniel's Blackberry from wealthier customers, especially in markets such as Brazil and Mexico.
Meanwhile, Canadian retailers continue to keep American-made alcohol off their shelves following a trade dispute last year, which has hurt liquor makers such as Brown-Forman.
Brown-Forman reaffirmed its organic full-year organic net sales decline in the low-single digit range and its organic operating income also in the low-single digit range .
Sales for the quarter ended January 31 rose 2% to $1.06 billion, ahead of analysts' estimate of $998.5 million, according to data compiled by LSEG.
The company posted profit per share of 58 cents, compared to estimates of 47 cents.
Net sales in United States saw a decline of 8% as alcohol demand has also taken a hit as health-conscious consumers shift toward non-alcoholic drinks and energy beverages, a trend compounded by the rapid adoption of GLP-1 weight-loss drugs. Younger drinkers, particularly Gen Z, are also pulling back from spirits and beers.
The company expects operating environment for fiscal 2026 to be challenging due to macroeconomic volatility and consumer uncertainty.
Peer Diageo cut its annual sales forecast last month stating pressure on consumer wallets was "by far and away" the biggest challenge.
Reporting by Koyena Das in Bengaluru; Editing by Shailesh Kuber
Source: Reuters