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Brown-Forman Reports Stellar Results in Fiscal 2013; Expects Another Strong Year of Growth in 2014

  Brown-Forman Reports Stellar Results in Fiscal 2013; Expects Another Strong
  Year of Growth in 2014

Business Wire

LOUISVILLE, Ky. -- June 5, 2013

Brown-Forman Corporation (NYSE:BFA) (NYSE:BFB) today reported financial
results for its fourth quarter and fiscal year ended April 30, 2013. For the
quarter, reported net sales^1 increased 8% to $866 million (+7% on an
underlying basis^2) and reported operating income increased 18% to $177
million (+15% on an underlying basis). Diluted earnings per share in the
quarter increased 8% to $0.52, compared to $0.49 in the prior year period,
including approximately $0.07 cents of benefits due to the timing of shipments
and discrete tax items.

For the full year, reported net sales increased 5% to $3,784 million (+8% on
an underlying basis), reported operating income increased 14% to $898 million
(+13% on an underlying basis), and diluted earnings per share increased 16% to
$2.75 compared to $2.37 in the prior year period. Reported earnings per share
were negatively impacted by the absence of Hopland-based wines and adverse
foreign exchange, but benefited from the aforementioned items in the fourth
quarter of 2013.

Paul Varga, the company’s chief executive officer, said, “We are pleased to
have delivered another year of top-tier industry results, with underlying
sales growth of 8% and underlying operating income growth of 13%. The company
achieved solid price increases, which helped drive margin expansion. Due to
continued global interest in North American whiskey and favorable trends in
premiumization, we remain cautiously optimistic that Brown-Forman’s strong and
balanced organic growth will continue in fiscal 2014.”

Fiscal 2013 Highlights

  *Underlying net sales increased 8%, driven by broad-based geographic gains
    and brand strength, with constant currency net sales^3 up 6%

       *Price/mix contributed over three points to net sales growth
       *Jack Daniel’s family of brands grew net sales 11%
       *The company’s super and ultra-premium whiskey brands grew net sales
         19%
       *Casa Herradura’s family of tequila brands grew net sales 9%
       *Finlandia’s family of brands grew net sales 6%

  *Underlying operating income increased 13%, driven by top-line growth,
    gross margin expansion, and operating expense leverage
  *As of April 30, 2013, Brown-Forman generated an industry-leading ROIC^4 of
    22%

Fiscal 2013 Performance

The company’s underlying sales growth of 8% was driven by strong brand
performance from its focused portfolio. The company’s outperformance was also
fueled by the strength of the North American whiskey category, continued
growth of Jack Daniel’s Tennessee Honey, and growth from premium and above
brands. Company-wide price/mix contributed approximately three points to full
year sales growth and drove the company’s global value share, while depletions
grew at a mid single-digit rate. This balanced revenue growth helped deliver
gross margin expansion of 200bps. Approximately half of the increase was
driven by improved price/mix and reductions in costs associated with
value-added packaging, while the other half was due to the absence of
Hopland-based wines.

The company enjoyed broad-based geographic gains, driven by strong results in
both the emerging markets and the developed world.

                                    
Brown-Forman Corporation – Top Ten Countries
Supplemental Information (Unaudited)
Twelve Months Ended April 30, 2013
Country            % of Net Sales    % Growth in Constant Currency Net
                                           Sales
United States^5    41%               8%
Australia          13%               6%
United Kingdom     9%                4%
Mexico             6%                8%
Germany            5%                13%
Poland             5%                5%
France             2%                14%
Russia             2%                36%
Japan              1%                18%
Turkey             1%                38%
                                           

In the emerging markets, net sales growth was widespread. Turkey’s net sales
jumped 38% as route-to-market changes implemented two years ago have
dramatically improved distribution as well as accelerated the success of
brand-building efforts among consumers in a rapidly growing distilled spirits
market. Russia enjoyed similarly strong year-over-year growth, increasing net
sales by 36%. Brazil, the company’s fourteenth largest market outside of the
United States, enjoyed a 23% increase in net sales. Ukraine, Kazakhstan, and
Georgia grew net sales by 29% to almost 300,000 cases in the aggregate.
Southeast Asia’s net sales grew 16% to 300,000 cases, driven by Thailand’s 19%
jump, India’s 26% increase, and Indonesia’s 29% growth. Emerging Africa
surpassed the 100,000 case mark with net sales growth of 12%.

Net sales continued to grow at a mid to high single-digit rate in most of the
developed markets, including a strong performance in the United States, where
net sales, adjusted for Hopland-based wines, grew by 8%. Australia and the
United Kingdom also continued to grow net sales in the mid single-digits,
while France grew by 14%, roughly in-line with its five and ten year rates of
growth. Not surprisingly, net sales growth in Italy and Spain remained under
pressure given the weak economic conditions, but the company’s portfolio
gained share in these challenging markets. Japan’s 18% net sales growth
included some inventory build related to the new agency relationship with
Asahi.

The company’s Global Travel Retail business delivered 12% net sales growth,
driven by price increases, successful innovation, and new product launches,
including the successful rollout of Jack Daniel’s Tennessee Honey and Jack
Daniel’s Sinatra Select.

The majority of the company’s brands delivered net sales growth in the year,
led by the Jack Daniel’s trademark. Jack Daniel’s Tennessee Whiskey grew net
sales by 7%, with markets outside of the United States modestly outpacing the
strong growth in the United States.

Jack Daniel’s Tennessee Honey’s global net sales nearly doubled in the second
full year in the marketplace. Sales in the United States grew by 37%, as brand
awareness has grown and velocity has increased in the off-premise. Sales
outside of the United States were driven by the successful rollout of the
brand to several key markets including the United Kingdom, Australia, Poland,
and South Africa. The company expects to bring this great product into other
important markets for Jack Daniel’s in fiscal 2014. Jack Daniel’s Tennessee
Honey, along with other innovations, contributed roughly 25% of the company’s
net sales growth in Fiscal 2013.

Brown-Forman’s portfolio of super and ultra-premium whiskey brands, including
Woodford Reserve and Woodford Reserve Double Oaked, Jack Daniel’s Single
Barrel, Gentleman Jack, and Collingwood, grew net sales almost 20% in the year
and depleted over 825,000 cases. Woodford’s performance was exceptional, up
28%, and the company believes there is a long global runway ahead for this
brand, including markets outside of the United States given only 14% of the
brand’s sales are currently generated in non-U.S. markets. Additionally, the
company intends to ramp up spending behind its Gentleman Jack brand in fiscal
2014 with the recent launch of the ‘Order of Gentlemen’ marketing campaign,
and believes this super-premium line extension is also well-positioned for
global growth. Markets outside of the United States grew net sales 30% in
fiscal 2013 and drove almost two-thirds of Gentleman Jack’s incremental sales.

Finlandia vodka’s family of brands grew net sales by 6%, reaching record
levels, with depletions of almost 3.3 million cases. Sales growth was driven
by strong demand in Russia.

The Casa Herradura family of tequila brands grew net sales by 9%. Herradura
grew global net sales 15%, fueled by 20% growth in the United States. New Mix
RTDs grew 13% and el Jimador grew net sales by 11% in the United States,
offset by a 2% decline in non-U.S. markets.

Southern Comfort’s family of brands net sales grew 1% in the United States,
but declined 4% globally, an improvement from the 7% decline in Fiscal 2012.
While Southern Comfort continued to experience sales declines in markets
outside of the United States, the company believes that fiscal 2013 marked the
first step towards returning the brand to global growth.

Underlying SG&A increased by 8% and underlying A&P spend grew by 6% in fiscal
2013, as the company continued to invest in its brands and the infrastructure
that will support the company’s goal of delivering long-term growth.

Dividends and Other

As of April 30, 2013, total debt was $1,002 million, compared with $510
million as of April 30, 2012. On February 25, 2013, Brown-Forman completed the
redemption of its outstanding $250 million 5% notes due 2014 and recorded a
pre-tax expense of $9 million.

During fiscal 2013, the company returned almost $1.1 billion to shareholders
through its recurring quarterly dividends as well as the $4 special dividend
paid during the third quarter of fiscal 2013. Brown-Forman has paid regular
cash dividends for 67 consecutive years and increased them for each of the
last 29 years, making Brown-Forman a member of the Standard and Poor’s 500
Dividend Aristocrats Index. The company also produced what it believes to be
an industry-leading return on invested capital of 22%.

Fiscal Year 2014 Outlook

Despite the uncertainty in the global macroeconomic environment, the company
is anticipating that the strong trends experienced in fiscal 2013 will
continue into fiscal 2014. Accordingly, the company currently expects high
single-digit growth in both reported and underlying sales, driven by the
continued global expansion of the Jack Daniel’s trademark, including both
Tennessee Whiskey and Tennessee Honey. The company’s focus on super-premium
brands including Herradura, Woodford Reserve, Gentleman Jack, and Jack
Daniel’s Single Barrel, along with continued growth in Finlandia and an
improvement in Southern Comfort’s results, should also drive sales growth.
Sales growth includes expected price increases in the low single-digit range,
which should help offset inflationary pressures.

Modest operating leverage through the SG&A line would result in underlying
operating income growth of approximately 9-11% and diluted earnings per share
of $2.80 to $3.00. Reported earnings per share include the anticipated
negative impact of $0.06 per share related primarily to the buyback of
inventory in France as the company transitions to an owned distribution model
on January 1, 2014, as well as a $0.02 negative impact from adverse foreign
exchange moves. The following table summarizes the current fiscal 2014
outlook, including the items that are expected to negatively impact reported
rates of growth:

                                                            
                                                            EPS Roll Forward
Fiscal 2013 Reported EPS                                     $2.75
Fiscal 2013 Adjustments:                                     
Shipments in excess of depletions                            -0.05
Discrete tax items                                           -0.02
Bond redemption fees                                         +0.03
Adjusted 2013 Baseline EPS^6                                 $2.71
Expected incremental EPS growth                              +0.17 to +0.37
Anticipated impact from France buyback and foreign exchange  -0.08
in fiscal 2014
Fiscal 2014 EPS Outlook                                      $2.80 to $3.00
                                                            

Brown-Forman will host a conference call to discuss the results at 10:00 a.m.
(EDT) this morning. All interested parties in the U.S. are invited to join the
conference call by dialing 888-624-9285 and asking for the Brown-Forman call.
International callers should dial 706-679-3410. The company suggests that
participants dial in ten minutes in advance of the 10:00 a.m. start of the
conference call.

A live audio broadcast of the conference call will also be available via
Brown-Forman’s Internet website, http://www.brown-forman.com/, through a link
to "Investor Relations." For those unable to participate in the live call, a
replay will be available by calling 855-859-2056 (U.S.) or 404-537-3406
(international). The identification code is 68352658. A digital audio
recording of the conference call will also be available on the website
approximately one hour after the conclusion of the conference call. The replay
will be available for at least 30 days following the conference call.

For more than 140 years, Brown-Forman Corporation has enriched the experience
of life by responsibly building fine quality beverage alcohol brands,
including Jack Daniel’s Tennessee Whiskey, Southern Comfort, Finlandia, Jack
Daniel’s & Cola, Canadian Mist, Korbel, Gentleman Jack, el Jimador, Herradura,
Sonoma-Cutrer, Chambord, New Mix, Tuaca, and Woodford Reserve. Brown-Forman’s
brands are supported by nearly 4,000 employees and sold in approximately 160
countries worldwide. For more information about the Company, please visit
http://www.brown-forman.com/.

Footnotes:

^1 Percentage growth rates are compared to prior year periods, unless
otherwise noted.
^2 Underlying change represents the percentage increase or decrease in
reported financial results in accordance with generally accepted accounting
principles (GAAP) in the United States, adjusted for certain items. A
reconciliation from reported to underlying net sales, gross profit,
advertising expense, SG&A, and operating income (non-GAAP measures) increases
or decreases for the three-month and twelve-month periods ended April 30,
2013, and the reasons why management believes these adjustments to be useful
to the reader, are included in Schedule A and the note to this press release.
^3 All ‘net sales’ references are on a constant currency basis, unless
otherwise noted. Constant currency represents reported net sales with the
cost/benefit of currency movements removed. Management uses the measure to
understand the growth of the business on a constant dollar basis, as
fluctuations in exchange rates can distort the underlying growth of the
business both positively and negatively.
^4 Return on invested capital is defined as the sum of net income (excluding
extraordinary items) and after-tax interest expense, divided by average
invested capital. Invested capital equals assets less liabilities, excluding
interest-bearing debt.
^5 Net sales growth in the United States is adjusted for Fiscal 2012’s $79
million in Hopland-based wine sales.
^6 We believe that excluding specific items which are not anticipated to
impact fiscal 2014 earnings provides helpful information in forecasting and
planning the growth expectations of the company.

Important Information on Forward-Looking Statements:

This report contains statements, estimates, and projections that are
“forward-looking statements” as defined under U.S. federal securities laws.
Words such as “aim,” “anticipate,” “aspire,” “believe,” “continue,”
“envision,” “estimate,” “expect,” “expectation,” “intend,” “may,” “plan,”
“potential,” “project,” “pursue,” “see,” “seek,” “should,” “will,” and similar
words identify forward-looking statements, which speak only as of the date we
make them. Except as required by law, we do not intend to update or revise any
forward-looking statements, whether as a result of new information, future
events, or otherwise. By their nature, forward-looking statements involve
risks, uncertainties and other factors (many beyond our control) that could
cause our actual results to differ materially from our historical experience
or from our current expectations or projections. These risks and other factors
include, but are not limited to:

  *Dependence upon the continued growth and profitability of the Jack
    Daniel’s family of brands
  *Unfavorable global or regional economic conditions, and related low
    consumer confidence, high unemployment, weak credit or capital markets,
    sovereign debt defaults, sequestrations, austerity measures, higher
    interest rates, political instability, higher inflation, deflation, or
    lower returns or discount rates on pension assets
  *Risks associated with being a U.S-based company with global operations,
    including political or civil unrest; local labor policies and conditions;
    protectionist trade policies; compliance with local trade practices and
    other regulations, including anti-corruption laws; terrorism; and health
    pandemics
  *Fluctuations in foreign currency exchange rates
  *Changes in laws, regulations or policies – especially those that affect
    the production, importation, marketing, sale or consumption of our
    beverage alcohol products
  *Tax rate changes (including excise, sales, VAT, tariffs, duties,
    corporate, individual income, dividends, capital gains) or in related
    reserves, changes in tax rules (e.g., LIFO, foreign income deferral, U.S.
    manufacturing and other deductions) or accounting standards, and the
    unpredictability and suddenness with which they can occur
  *Changes in consumer preferences, consumption or purchase patterns –
    particularly away from brown spirits, our premium products, or spirits
    generally, and our ability to anticipate and react to them; decline in the
    social acceptability of beverage alcohol products in significant markets;
    bar, restaurant, travel or other on-premise declines
  *Production facility, aging warehouse or supply chain disruption;
    imprecision in supply/demand forecasting
  *Higher costs, lower quality or unavailability of energy, input materials
    or finished goods
  *Route-to-consumer changes that affect the timing of our sales, temporarily
    disrupt the marketing or sale of our products, or result in
    implementation-related or higher fixed costs
  *Inventory fluctuations in our products by distributors, wholesalers, or
    retailers
  *Competitors’ consolidation or other competitive activities, such as
    pricing actions (including price reductions, promotions, discounting,
    couponing or free goods), marketing, category expansion, product
    introductions, entry or expansion in our geographic markets or
    distribution networks
  *Risks associated with acquisitions, dispositions, business partnerships or
    investments – such as acquisition integration, or termination difficulties
    or costs, or impairment in recorded value
  *Insufficient protection of our intellectual property rights
  *Product counterfeiting, tampering, or recall, or product quality issues
  *Significant legal disputes and proceedings; government investigations
    (particularly of industry or company business, trade or marketing
    practices)
  *Failure or breach of key information technology systems
  *Negative publicity related to our company, brands, marketing, personnel,
    operations, business performance or prospects
  *Business disruption, decline or costs related to organizational changes,
    reductions in workforce or other cost-cutting measures, or our failure to
    attract or retain key executive or employee talent

For further information on these and other risks, please refer to the “Risk
Factors” section of our annual report on Form 10-K and quarterly reports on
Form 10-Q filed with the SEC.

Use of Non-GAAP Financial Information This press release includes measures not
derived in accordance with generally accepted accounting principles (“GAAP”),
including underlying net sales and underlying operating income. These measures
should not be considered in isolation or as a substitute for any measure
derived in accordance with GAAP, and also may be inconsistent with similar
measures presented by other companies. Reconciliations of these measures to
the most closely comparable GAAP measures, and reasons for the company’s use
of these measures, are presented on Schedule A attached hereto.

                                                             
Brown-Forman Corporation

Unaudited Consolidated Statements of Operations

For the Three Months Ended April 30, 2012 and 2013

(Dollars in millions, except per share amounts)
                                                                             
                       2012                    2013                    Change
                                                                             
Net sales              $  801                  $  866                  8   %
Excise taxes              198                     206                  4   %
Cost of sales            181                   200                 11  %
Gross profit              422                     460                  9   %
Advertising               99                      99                   1   %
expenses
Selling,
general, and              175                     180                  3   %
administrative
expenses
Other (income)           (2       )             4        
expense, net
Operating income          150                     177                  18  %
Interest                 7                     16       
expense, net
Income before             143                     161                  12  %
income taxes
Income taxes             38                    48       
Net income             $  105                 $  113                 8   %
                                                                             
Earnings per
share:
Basic                  $  0.49                 $  0.53                 8   %
Diluted                $  0.49                 $  0.52                 8   %
                                                                             
Gross margin              52.6     %              53.1     %
Operating margin          18.7     %              20.4     %
                                                                             
Effective tax             27.1     %              29.7     %
rate
                                                                             
Cash dividends
paid per common        $  0.23                 $  0.26
share
                                                                             
Shares (in
thousands) used
in the
calculation of
earnings per
share
Basic                     213,024                 213,581
Diluted                   214,610                 215,212
                                                                             
Note: All previously reported share and per share amounts have been restated
to reflect the 3-for-2 stock split effected in August 2012.

                                                             
Brown-Forman Corporation

Unaudited Consolidated Statements of Operations

For the Years Ended April 30, 2012 and 2013

(Dollars in millions, except per share amounts)
                                                                             
                       2012                    2013                    Change
                                                                             
Net sales              $  3,614                $  3,784                5  %
Excise taxes              891                     935                  5  %
Cost of sales            928                   894                 (4 %)
Gross profit              1,795                   1,955                9  %
Advertising               395                     408                  3  %
expenses
Selling,
general, and              610                     650                  7  %
administrative
expenses
Amortization              3                       --
expense
Other (income),          (1       )             (1       )
net
Operating income          788                     898                  14 %
Interest                 28                    33       
expense, net
Income before             760                     865                  14 %
income taxes
Income taxes             247                   274      
Net income             $  513                 $  591                 15 %
                                                                             
Earnings per
share:
Basic                  $  2.39                 $  2.77                 16 %
Diluted                $  2.37                 $  2.75                 16 %
                                                                             
Gross margin              49.7     %              51.7     %
Operating margin          21.8     %              23.7     %
                                                                             
Effective tax             32.5     %              31.7     %
rate
                                                                             
Cash dividends
paid per common
share:
Regular
quarterly cash         $  0.89                 $  0.98
dividends
Special cash             --                    4.00     
dividend
Total                  $  0.89                $  4.98     
                                                                             
Shares (in
thousands) used
in the
calculation of
earnings per                                                                 
share
Basic                     214,529                 213,369
Diluted                   216,083                 214,986
                                                                             
Note: All previously reported share and per share amounts have been restated
to reflect the 3-for-2 stock split effected in August 2012.

                                                       
Brown-Forman Corporation

Unaudited Condensed Consolidated Balance Sheets

As of April 30, 2012 and 2013

(Dollars in millions)
                                                                    
                                               2012         2013
Assets:
Cash and cash equivalents                      $ 338        $ 204
Accounts receivable, net                         475          548
Inventories                                      712          827
Other current assets                            224         242
Total current assets                             1,749        1,821
                                                                    
Property, plant, and equipment, net              399          450
Goodwill                                         617          617
Other intangible assets                          668          668
Other assets                                    44          70
Total assets                                   $ 3,477      $ 3,626
                                                                    
Liabilities:
Accounts payable and accrued expenses          $ 386        $ 451
Short-term borrowings                            4            3
Current portion of long-term debt                3            2
Other current liabilities                       11          17
Total current liabilities                        404          473
                                                                    
Long-term debt                                   503          997
Deferred income taxes                            158          180
Accrued postretirement benefits                  278          280
Other liabilities                               65          68
Total liabilities                                1,408        1,998
                                                                    
Stockholders’ equity                            2,069       1,628
                                                                    
Total liabilities and stockholders’ equity     $ 3,477      $ 3,626

                                                            


Brown-Forman Corporation

Unaudited Condensed Consolidated Statements of Cash Flows

For the Twelve Months Ended April 30, 2012 and 2013

(Dollars in millions)
                                                                             
                                                   2012           2013
                                                                             
Cash provided by operating activities              $ 516          $ 537
                                                                             
Cash flows from investing activities:
Additions to property, plant, and equipment          (58  )         (95    )
Other                                               (10  )        (2     )
Cash used for investing activities                   (68  )         (97    )
                                                                             
Cash flows from financing activities:
Repayment of long-term debt                          (252 )         (253   )
Proceeds from long-term debt                         --             747
Acquisition of treasury stock                        (220 )         --
Dividends paid                                       (192 )         (1,063 )
Other                                               2            (7     )
Cash used for financing activities                   (662 )         (576   )
                                                                             
Effect of exchange rate changes on cash and         (15  )        2      
cash equivalents
                                                                             
Net decrease in cash and cash equivalents            (229 )         (134   )
                                                                             
Cash and cash equivalents, beginning of period      567          338    
                                                                             
Cash and cash equivalents, end of period           $ 338         $ 204    

                                                          
Schedule A
                                                                   
Brown-Forman Corporation
Supplemental Information (Unaudited)
                                                                   
                                                                   
                             Three Months       Twelve             Fiscal Year
                             Ended              Months Ended       Ended
                             Apr 30, 2013       Apr 30, 2013       April 30,
                                                                   2012
                                                                   
                                                                   
                                                                   
Reported change in net       8%                 5%                 6%
sales
Impact of foreign            1%                 1%                 -
currencies
Impact of Hopland-based      -                  2%                 2%
wine business sale
Estimated net change in      (2%)               (1%)               1%
distributor inventories
                                                                   
Underlying change in net     7%                 8%                 9%
sales
                                                                   
                                                                   
Reported change in gross     9%                 9%                 4%
profit
Impact of foreign            2%                 1%                 1%
currencies
Impact of Hopland-based      1%                 1%                 3%
wine business sale
Estimated net change in      (4%)               (1%)               -
distributor inventories
                                                                   
Underlying change in         8%                 10%                8%
gross profit
                                                                   
Reported change in           1%                 3%                 8%
advertising
Impact of foreign            2%                 2%                 -
currencies
Impact of Hopland-based      1%                 1%                 1%
wine business sale
                                                                   
Underlying change in         4%                 6%                 9%
advertising
                                                                   
Reported change in SG&A      3%                 7%                 6%
Impact of Hopland-based      1%                 -                  -
wine business sale
Dispute settlement           -                  -                  (1%)
Impact of foreign            -                  1%                 1%
currencies
                                                                   
Underlying change in         4%                 8%                 6%
SG&A
                                                                   
Reported change in           18%                14%                (8%)
operating income
Impact of foreign            6%                 1%                 3%
currencies
Impact of Hopland-based      3%                 1%                 12%
wine business sale
Dispute settlement           -                  -                  1%
Estimated net change in      (12%)              (3%)               1%
distributor inventories
                                                                   
Underlying change in         15%                13%                9%
operating income
                                                                   
Note: Totals may differ due to rounding


Notes:

Foreign currencies – Refers to net gains and losses incurred by the company
relating to sales and purchases in currencies other than the U.S. Dollar.
Brown-Forman uses the measure to understand the growth of the business on a
constant dollar basis as fluctuations in exchange rates can distort the
underlying growth of the business (both positively and negatively). To
neutralize the effect of foreign exchange fluctuations, the company has
translated current year results at prior year rates. While Brown-Forman
recognizes that foreign exchange volatility is a reality for a global company,
it routinely reviews its performance on a constant dollar basis. The company
believes this allows management and investors to understand Brown-Forman’s
growth trends.

Hopland-based wine business sale – Refers to the company’s April 2011 sale of
its Hopland, California-based wine business to Viña Concha y Toro S.A., whose
brands were retained in the company’s portfolio as agency brands through
December 31, 2011. This agency relationships resulted in fiscal 2012 reported
net sales of $79 million and $0.03 per diluted share. Included in this sale
were the Fetzer winery, bottling facility, and vineyards, as well as the
Fetzer brand and other Hopland, California-based wines, including Bonterra,
Little Black Dress, Jekel, Five Rivers, Bel Arbor, Coldwater Creek, and
Sanctuary. Also included in the sale was a facility in Paso Robles,
California.

Estimated net change in distributor inventories – Refers to the estimated
financial impact of changes in distributor inventories for the company’s
brands. Brown-Forman computes this effect using estimated depletion trends and
separately identifying trade inventory changes in the variance analysis for
key measures. Based on the estimated depletions and the fluctuations in
distributor inventory levels, the company then adjusts the percentage
variances from prior to current periods for our key measures. Brown-Forman
believes it is important to make this adjustment in order for management and
investors to understand the results of the business without distortions that
can arise from varying levels of distributor inventories.

Dispute settlement – Refers to the favorable resolution of a dispute in an
international market relating to the importation of our products. Management
believes that excluding this benefit provides helpful information in
forecasting and planning the growth expectations of the company.

The company cautions that non-GAAP measures should be considered in addition
to, but not as a substitute for, the company’s reported GAAP results

                                       
Schedule B


Brown-Forman Corporation

Supplemental Information (Unaudited)

Twelve Months Ended April 30, 2013
                                                                                      
                                           % Change vs. FY2012
                  Depletions (000’s)      Depletions            Net Sales
                            Equivalent               Equivalent              Constant
Brand           9-Liter                9-Liter              Reported  Currency
                            Conversion^1             Conversion
Jack Daniel’s   19,013   13,094        6%       6%          9%        11%
Family
Jack Daniel’s
Family of       12,437   12,428        6%       6%          10%       12%
Whiskey
Brands^2
Jack Daniel’s   6,576    658           5%       5%          5%        7%
RTD/RTP^3
el Jimador      6,928    1,796         5%       2%          6%        7%
Family
el Jimador      1,225    1,225         0%       0%          2%        2%
New Mix RTD^4   5,698    570           6%       6%          13%       13%
Finlandia       3,476    3,299         6%       5%          3%        6%
Family
Finlandia       3,279    3,279         5%       5%          2%        5%
Finlandia RTD   193      19            26%      26%         24%       30%
Southern
Comfort         2,353    2,046         (5%)     (3%)        (5%)      (4%)
Family
Southern        2,012    2,012         (2%)     (2%)        (4%)      (3%)
Comfort^5
Southern
Comfort         341      34            (19%)    (19%)       (15%)     (15%)
RTD/RTP
Canadian Mist   1,600    1,600         (3%)     (3%)        (1%)      (1%)
Korbel          1,330    1,330         4%       4%          6%        6%
Champagne
Super-Premium   1,182    1,182         6%       6%          10%       10%
Other^6
Rest of Brand
Portfolio
                2,118    2,118         6%       6%          5%        8%
(excl.
Discontinued
Brands)
Total Active    38,005   26,466        4%       4%          7%        8%
Brands
                                                                        
Note: Totals may differ due to rounding

^1 Equivalent conversion depletions represent the conversion of ready-to-drink (RTD)
brands to a similar drinks equivalent as the parent brand for various trademark
families. RTD volume is divided by 10.
^2 Jack Daniel’s brand family excluding RTD/RTP line extensions
^3 Refers to all RTD and ready-to-pour (RTP) line extensions of Jack Daniel’s
^4 RTD brand produced with el Jimador tequila
^5 Includes Southern Comfort, Southern Comfort Reserve, and Southern Comfort flavors
^6 Includes Chambord liqueur and flavored vodka, Herradura, Sonoma-Cutrer, Tuaca, and
Woodford Reserve

Contact:

Brown-Forman Corporation
Phil Lynch, 502-774-7928
Vice President
Director Corporate Communications and Public Relations
or
Jay Koval, 502-774-6903
Vice President
Director Investor Relations
 
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