Brown-Forman, the American producer of the Jack Daniels and Southern Comfort brands, has reported net sales of US$1bn in the three months to 31 October 2011, a rise of 12%, with the UK among the countries experiencing growth. Operating income increased 5% to US$246m for the quarter, and 6% for the half-year to US$432m. Diluted earnings per share in the period increased 4% to $1.09 in the quarter. Half-year net sales were up 12% to US$1.9bn, and diluted earnings were up 5% to US$1.90 per share. “First half reported net sales benefitted from underlying growth and higher estimated net distributor inventory levels, the latter of which was attributable to several factors, including advanced buying ahead of anticipated price increases in several markets, the timing of promotional activities, and pipeline fill associated with product innovations,” the firm said. “The company expects distributor inventories will rebalance in the second half of the fiscal year, reducing the growth rate in reported net sales. However, the company anticipates underlying net sales growth for the full fiscal year in the high single digits.” Brown-Forman said growth in markets such as the UK, Turkey, France, Brazil, Australia and Canada more than offset “soft” performances in a few markets such as Spain and Poland. Chief executive Paul Varga said: “We delivered an excellent quarter and strong first half as we accelerated our growth in underlying net sales and operating income versus fiscal 2011. “Performance was led by the Jack Daniel’s trademark, which grew volumes globally at a double-digit rate, and drove the company’s widespread geographic growth. This performance was aided by compelling portfolio innovation, particularly in the Jack Daniel’s Family, growth in our super-premium brands, and continued international growth of the brand portfolio. Each of these is an important contributing element to our long-term growth strategy. “While we expect the strengthening of the US dollar to dampen our reported earnings, we anticipate the continuation of our strong underlying results for the remainder of our fiscal year.”