Good morning, and welcome to Brown-Forman First Quarter Fiscal Year 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions]. I would now like to hand the conference over to Sue Perram, Vice President, Investor Relations. Ma'am, you may begin.

Thank you, and good morning, everyone. I would like to thank each of you for joining us today for Brown-Forman's First Quarter Fiscal Year 2024 Earnings Call. Joining me today are Lawson Whiting, President and Chief Executive Officer, and Leanne Cunningham, Executive Vice President and Chief Financial Officer. This morning's conference call contains forward-looking statements based on our current expectations. Numerous risks and uncertainties may cause actual results to differ materially from those anticipated or projected in these statements. Many of the factors that will determine future results are beyond the company's ability to control or predict. You should not place undue reliance on any forward-looking statements, and except as required by law, the company undertakes no obligation to update any of these statements, whether due to new information, future events or otherwise. This morning, we issued a press release containing our results for the first quarter fiscal year 2024, in addition to posting presentation materials that Lawson and Leanne will walk through momentarily. Both the release and the presentation can be found on our website under the section titled Investors, Events and Presentations. In the press release, we have listed a number of the risk factors you should consider in conjunction with our forward-looking statements. Other significant risk factors are described in our Form 10-K and Form 10-Q reports filed with the Securities and Exchange Commission. During this call, we will be discussing certain non-GAAP financial measures. These measures are reconciliation to the most directly comparable GAAP financial measures and the reasons management believes they provide useful information to investors regarding the company's financial condition and results of operations, are contained in the press release and investor presentation. With that, I would like to turn the call over to Lawson.

Thank you, Sue, and good morning, everyone. It's a pleasure to be able to speak to you today about Brown-Forman's first quarter results for fiscal 2024. Before we get into the details of the quarter, there are a few key drivers of our first quarter results that you will hear about repeatedly throughout this call. First, the rebuilding of distributor inventories, primarily in the United States in the prior year period had a significant impact on our first quarter results. As you will recall, this rebuilding in the prior year occurred as a result of supply chain disruptions. If you reference Schedule D in today's earnings release, it will provide you with additional information to put this quarter into better context. Second, the timing and phasing of our operating expenses had an impact on our first quarter operating income as we launched and acquired new brands while also investing in our existing portfolio. As you can surmise from our full year guidance, we expect this to moderate as we continue throughout the rest of the fiscal year. And finally, and most importantly, we believe the health of our brands and our business remain strong as evidenced by consumer takeaway trends. We continue to be confident that we have the best portfolio and the best people in the market, and it's this confidence that allows us to reaffirm our full year outlook for fiscal 2024. With this backdrop, let me quickly walk you through our high-level results for the first quarter. From a top-line perspective, our reported and organic top-line results were below our longer-term historical trends. Much of this is being driven by the comparison to the strong double-digit top-line growth in the first quarter of last year. You'll recall our glass supply significantly increased in the spring and summer…

Thank you, Lawson, and good morning, everyone. As Lawson mentioned, I will provide additional details on our geographic performance, other financial highlights, as well as our fiscal 2024 outlook. From a geographic perspective, collectively, our emerging international markets continued to deliver very strong double-digit organic net sales growth, driven by Jack Daniel's Tennessee Whiskey, particularly in the United Arab Emirates due to increased distribution and strong consumer demand in Turkiye, where the premium whiskey category is accelerating. Jack Daniel's Tennessee Honey led by Turkiye as well as Brazil, where the brand is returning to normal levels of supply and new mix, which continues to grow strong double digits in Mexico, where the RTD category is accelerated, and we are gaining share. As the international airline travel and cruise business continued to return to more normalized growth levels, the travel retail channel grew organic net sales 9%, led by higher volumes of Woodford Reserve. Our business in this channel continues to remain above pre-pandemic levels. Organic net sales for our developed international markets collectively were flat in the first quarter as growth in the United Kingdom, South Korea and Germany was offset by declines in Australia and Japan. Jack Daniel's Tennessee Apple was the largest contributor to growth driven by the successful launch of the brand in South Korea. This growth was offset by year-over-year declines for Jack Daniel's RTDs, driven by Australia, where macroeconomic pressures negatively impacted volume growth and the United Kingdom, where we are transitioning from Jack Daniel's and Cola to Jack Daniel's and Coca-Cola, partially offset the growth in Germany and Jack Daniel's Tennessee Whiskey, which had strong growth in the United Kingdom, but was negatively impacted by Japan due to an estimated net decrease in distributor inventory where we remain on track for our transition to…

[Operator Instructions]. Our first question comes from the line of Nadine Sarwat with Bernstein. Your line is open.

Hi, thank you for taking my questions. I'd like to zoom in on the distributor inventory in two parts. So the first, could you just quantify how much of the change in distributor inventory was due to the tough comp you highlighted versus how much is due to actual distributor destocking? And if there is a fair amount of actual destocking, what is driving this? And then secondly, are you happy with current distributor stock levels? Or should we be expecting some destocking in the next quarter? Thank you.

Good morning, Nadine. Thank you. I'll start with the first part of your question, which is we have talked about the comp that we had in the first quarter compared to the comp that we had in the last -- the first quarter of last year, which was when we had very strong shipments. And if you go back to our -- what is that point in time was the Schedule C, you would have seen the impact that we had there. So it is partially that we are comping the very strong comp. It's also, we don't see it as destocking. We have finally gotten our inventory levels back up to what we believe is normal. We've been working on that for a year and bringing you along in that story along the way. What we see now is a change in distributor buying patterns in that other part that you're asking about. And it really comes back to, we continue that we lapped everything related to the pandemic. We now have to comp the things related to supply chain disruption. And as we got into supply chain disruption before that, we had a very consistent cadence and seasonality of our shipments. But due to the various ways that we determined that we needed to rebuild our distributor inventories, first, prioritizing Jack Daniel's Tennessee Whiskey, which would have started in the second half of 2020 and then moving into the first half of 2023, where we were able to prioritize Woodford Reserve, Gentleman Jack and Jack Daniel's flavors. We also prioritize markets for the US first and then Europe and emerging international as we worked our way through the rebuilding of the inventory. So the cadence and timing of our shipments are abnormal from what we would -- our historic norms. So once we're back into a stable inventory position for long enough, we believe it will become less volatile and will be kind of back to our historic norms. But again, for us, we have been working for a year to get back up to that normal level of inventory across the world, and we now believe that we're there. So I hope that helps.

Let me try to add on to that, Nadine, a little bit, too, because I do want to make sure everybody sort of -- I get that this is really confusing. And I do make -- reiterate really what Leanne said, that this is a comparison issue though, it is not a destocking. And let me give you why it's not a destocking because I knew that would sort of feel normal at this point. So if you go -- literally, you can go back three years, the summer of 2020 into the fall, really into the spring of -- I'm talking calendar years here, not fiscals. We -- it was kind of the boom years. It was the post-COVID, Nielsen numbers were up at like 30% for everyone, and there was just an enormous uplift in the entire industry. You get to the summer of '21, and it begins to show up in terms of glass shortages really for Brown-Forman, it's seemingly worse than everyone else. But we really began to have those challenges in the summer of '21, and it was a challenge for about eight months, where we ran global inventories down so low, and that would be going so far as to say the consumer inventory, the retail inventories, layers of distributors had got very low and we had out of stocks all over the place. We were at that time, working very hard. We're diversifying our glass supply. We're moving bottling lines. We're doing all sorts of things to try to alleviate the glass shortage and it starts to come back right in the spring of '22. So -- and as Leanne said, we prioritize Jack because at that point, the on-premise is opening around the world and we did not want to miss that.…

All right. That's very helpful. So just to clarify, I know in the release you called out that it was partially due to the comp issue, are you saying that there is no destocking whatsoever? There isn't a change in distributor buying patterns more caution. This is purely a comp cadence issue? And then if you could just clarify what we should expect for Q2? Thank you.

Yeah. So just for clarification, we said partially comping the rebuilding and it's also partially a change in the distributor buying patterns because we are off our normal cadence of shipments or our historical trends because of how we chose to prioritize how we rebuilt our brands and in what markets we were rebuilding those. So over the longer period of time, that will begin to normalize.

Thank you. Perfect. Thank you.

Our next question comes from the line of Bryan Spillane with Bank of America. Your line is open.

Hey. Thanks, operator, and good morning, Lawson, Leanne. So thanks for all of that commentary on inventory. And I guess if I were to sum it up, if you deplete 10 cases, you'll ship 10 cases, right? That's what the plan is built on?

Pretty much.

Okay. And then, Lawson, maybe could you just give a little perspective on depletions in the quarter. Volume depletions were up 1%. And so could you just kind of put that in context of -- is that more or less in line with what you were expecting? Maybe what that looks like relative to the industry? There's a lot of focus right now on volume and volume growth and just what's happening with consumption, not just for Brown-Forman, just more broadly across our entire coverage, consumer coverage universe. So just trying to get a sense of, if you could put that into perspective of just what you're seeing in terms of volume consumption trends and whether kind of a 1% to 2% type depletion is maybe what we should be thinking about in terms of Brown-Forman and maybe just the industry for the year?

I'll add some color to that. And if you look at Schedule B, you can see that really, for the most part, shipments and depletions are aligned except for where you -- we get down to the Jack Daniel's ready-to-drink and that's all about the launch of the Jack Daniel's and Coca-Cola in the US. So where we are right now is they're in line. Over a longer period of time, as shipments over the last few years have been stronger than depletions as we've been working to rebuild inventories, we do expect that depletions would need to come back in long and will exceed our shipments in this year is what is built into our guidance. So as we think about that, we will continue to update you as we go through the quarters. But right now, you still believe our depletions will be a bit ahead of our shipments as we go through this fiscal year.

I mean, I think to tear it apart a little bit by geography, I mean, the US market, if you look at GDS in Nielsen, it's sort of between five and six, I think, we're right there, too. So the US market, I mean, there's so much noise in the sales numbers, I know. But the US market is in a pretty decent shape. It's definitely being elevated by the RTD piece of things. So I do -- I think it's fair to say the full strength has the -- some of its comparisons, but the full strength market has softened a little bit. But it's being made up for us for the most part in our international markets, which continue to be really strong and particularly the emerging markets, which really is in its third year of pretty outstanding growth. That growth is coming from a very wide variety of markets, which is always nice also. It's one of the -- while we are so dependent on Jack Daniel's, when you talk about the international markets, there's so much geographic diversification that for instance, South America and Mexico, we've had an outstanding run and there are markets in Eastern Europe that are on really strong runs right now. So we've got really strong pockets of growth coming out of some of our most important markets. UK is actually in pretty good shape right now, too, and is delivering well. So no, the business is not turning into a 1% growth. No one is thinking of that.

Very helpful. Thanks, Lawson.

Thank you. Please stand by for our next question. Our next question comes from the line of Eric Serotta with Morgan Stanley. Your line is open.

Great. Thanks, everyone. With regards to the comment that you made in the press release and on the prepared remarks about declines in the old Jack & Cola offsetting growth in the Jack & Coke launch. If I remember correctly, the previous comments that you made were that Jack & Coke was nicely incremental. So just looking for some color as to why they largely offset in the quarter. Was there a timing issue with getting some of the old Jack & Cola of the channel or was some of this -- a lot of this growth reported Coke’s books and not yours? Any color into that dynamic would be very, really helpful.

Yeah. Sure, because this is one of the topics that also is a little bit confusing. So as I mentioned in my prepared remarks, the global volumes, it's about 1.8 million cases across the 11 markets. Now the part -- I think most people know, but a reminder, I guess, some markets are led by Brown-Forman and others are being led by the Coca-Cola Company. So that is what is throwing some of our volume numbers off in the spreadsheet. And I think it's what you're referring to. There are markets where Coca-Cola is taking the lead, and I'll use the UK as a good -- probably the clearest example. We had a big Jack & Cola business there, and now we are evolving that over to Jack & Coke. So those sales of the actual -- sales to the Tescos of the world, will not be on our books anymore, it's going to be on the Coca-Cola's books but it doesn't mean the business is going away, it's just we're taking out the cola and replenishing or replacing it with Jack & Coke. And so that's why the numbers look like they're going down, but that's not really the case in real -- system-wide, they're not. It's just the way that's being reflected on our financial statements. So -- and I think -- look, I'd also reiterate, I mean, this has been a great launch. It's an iconic product. We are really investing highly behind this launch as is the Coca-Cola Company. And so -- there's been a lot of broad reach media, there's events, there's trade executions, and it's got -- it is off to a very strong start. So the increased visibility, I think, is important, the market share gains we're getting. We've got a lot of positive factors. So -- and it's got 2% of the category in the US. It's got 2% share already, and it's only been three or four months. So it's off to a good start, and we feel pretty good about it. And I think the long-term potential is exciting and a lot of things that it does for the health of the brand, along with the actual business proposal itself. So it’s ff to a good start.

Great. And then just to follow up on the inventory dynamic. Hopefully, this is one of the last questions on it. You did mention or you did flag rightfully so, I think some tough comp again in the second quarter. My recollection is the rebuild last year in the second quarter was somewhat less than it was in the first quarter. Am I remembering that correctly, and should we expect some sort of moderation in that year-on-year headwind in the second quarter before, all things being equal, should be about neutral in the second half?

You're remembering that correctly. And what we're talking about as far as comp is the entire company because we had the really strong shipments in the first half of last year. But you are correct that as we get into the second quarter, the shipments and depletions more normalized. But the one thing we have to remember is, and we'll share this with you every quarter as we get into the fourth quarter of fiscal 2024, then we'll have to lap the launch of Jack Daniel's and Coca-Cola in the US.

Yes. I mean, so it is less. Q2, I said a minute ago, Jack was still up 14% in Q2. So it's still -- we've still got high comps, but it is normalizing.

Terrific. I’ll pass it on. Thanks for your help.

Thank you. Please stand by for our next question. Our next question comes from the line of Andrea with JPMorgan. Your line is open.

Hey, good morning. This is Drew Levine on for Andrea. Thanks for taking our questions. So I wanted to pick up on the US. So it looked like underlying trends were up around 2% in the quarter and, Lawson, you mentioned TDS was up sort of mid-single digit. And in the track channels, it looks like given Brown-Forman was up stronger than that. So just curious if you can elaborate maybe on what the disconnect there is? And if we should see that sort of delta between the underlying growth rate and what we're seeing in track channels narrow looking ahead?

Well, I mean, those numbers never tick and tie exactly. I think the 5% growth number, which includes Jack & Coke, it’s a pretty solid sort of result. The US for like a decade has been between 4% and 5% with the exception of these sort of post-COVID years when it really blew up. Yeah, the difference between the -- getting from minus 9% on an organic basis and adjusting for the distributor inventories is what gets you to the 2%. I don't know if I can explain the difference between the 2% and 5% necessarily. I don't think it's not a huge number.

It's really about the launch of the Jack & Coke and how it is and the buying patterns that are in there. So that's creating a lot of noise in the difference between what you would see in our takeaway trends and what's happening in our net sales. So it's just -- again, as we were coming through and the gap is narrowing over the last few quarters, but then as we launched Jack and Coke and it's not all the way through into those takeaway numbers yet. That's creating the gap for us.

All right. Fair enough. And then if I could ask a follow-up on gross margins. So it looks like costs were about 100 bps headwind this quarter, moderated from the fourth quarter, which I think was around 350 bps. And you mentioned you'll be lapping a lot of those supply chain mitigation efforts from last year. So can you maybe offer some more color on gross margin expectations looking ahead? Should we think about gross margins potentially over 60% here going forward? And then on the Blanco or agave situation, is there any sort of way to think about the internal versus external mix of supply there? So, thank you for that.

Okay. Great. Thanks. So I'll start with our gross margin for the first quarter, which was, as you noted, expanded 90 basis points, and it's where our price/mix more than offset the inflation on our input cost. And it was really driven by our price mix, which was plus 250 basis points that was driven by kind of the price increases across our portfolio that was led by Jack Daniel's Tennessee Whiskey. We also still, and I'll just point this out, as the last time I'll have the opportunity to say it is the last of the benefit from the removal of the UK tariffs on American whiskey because they rolled off June 1 of '22. And as you pointed out, the impact of inflation on our input cost has been partially offset by supply chain disruption costs. And then, so that's a good segue for me to go into the full year. And again, everything I say here is built into our operating income guidance. But we do expect price mix to continue to be a leader for us this year with our long-term pricing and new growth management strategies. We'll have the -- from a cost perspective, we'll have the absence of the supply chain disruption costs that will be significantly less to zero in F '24. And we'll still have inflation that will negatively impact our input cost in total, but though at a lower level. And to your question, I'll talk to you about a couple of our key input items starting with agave. And it really is about what we said. We've been talking about this for a very long time. We're really excited that it's finally starting to come down. We've been looking out there for such a long period of time seeing those…

Thanks for the color.

Thank you. Please stand by for our next question. Our next question comes from Vivien Azer with Cowen. Your line is open.

Hi, good morning. I was hoping to ask about advertising spending a little bit. Understanding that the growth this quarter is really a phasing, and we heard you loud and clearly on kind of the longer-term aspiration to grow A&P in line with sales. But, Leanne or Lawson, I was just curious how you're viewing the evolution of the competitive dynamic in TBA in the United States, for a whole host of reasons, a number of public beer companies are stepping up their A&P for the remainder of the year. I'm just wondering how you're thinking about the potential impact on distilled spirit sales as a result and the potential to -- potential need for you guys to spend more? Thanks.

Yeah. I mean I had not heard that the beer companies were really stepping up that much. But I do think, as you said, the long-term philosophy is to keep it in step with sales. We have significantly increased our [pop-up] (ph) spending in the last two years, I mean by well over $100 million. And so I think we feel pretty good that we have gotten ourselves in a comfortable place. And I think we can manage the P&L from there. I mean, look, the beer companies are struggling. And so they are quite sure they are trying to figure out ways to obviously turn their brands around, some brands are in real trouble. And they're going to find a way to try to spend their way out of that. But I don't see us doing that. And I don't really think, at least in the short term, I don't see much of a reaction out of us because of that. Their challenges are sort of unique to them, and we'll continue to hop forward the way we have.

Yeah. And if you don't mind, Vivien, I'll kind of scope back out, and I'll kind of talk about our full year because I think we need to put what happened in Q1 into context with how we're thinking about the full year. So I'm going to go a little bit broader first, just to say, like I've shared, we've lapped the impact of the pandemic to a more normalized level, and we're on that elevated base. We're still lapping impact of just supply chain disruption. But the reasons we believe that we're going to deliver our full year guidance is we lap those strong shipments of the rebuilding of our distributor inventory. And like we talked about here today, once we adjust for the estimated net change in distributor inventories that you've seen on Schedule D, we believe our brands and our business are healthy. So I'll tie that back to how we're investing in it. The investment really kind of came with the launch of Jack Daniel's and Coca-Cola in the US. We are getting ready to launch that in September, which is just a few days away in Germany. So when Lawson said in his prepared remarks that the majority of that hit in the first few months of the year, it's to support those launches, and we're going to get back to that normal trend. But I think it's important to go ahead and say, for our full year, we've got our pricing and our revenue strategies, we've got the addition in the back of the year that's not in the first half of the year, which is the impact of Gin Mare and Diplomatico that will be moving into our organic results. So we feel good about our top-line guidance. We also feel good about the absence of supply chain disruptions and the costs associated with that. We feel good that from a full year perspective, we will invest in our brands in a way that lands with how we planned it, which is in line with top-line growth though heavily skewed to the front end. And that, we've said this already, but from an operating expense perspective, SG&A, we continue to invest in our route to consumers. We know that's Japan and also Slovakia for fiscal 2024. And we've got all this built into our guidance. So even with all the noise that we're talking through today, we believe we're going to land our operating income growth at that 6% to 8%.

One more comment on the beer versus spirits thing, more to the RTD world. I think it's just -- and their need to advertise because the malt-based RTDs obviously have gone through a huge amount of upheaval in the last few years where they exploded and then they've taken a sharp dive. Most -- a lot of it is coming at the expense of the spirit-based RTDs which I just -- I found interesting. I don't think any of us predicted that to happen. But I think at the end of the day, the consumer is willing to pay more, substantially more for a spirit-based RTD than a malt-based RTD because they taste better. And that is making the numbers get a little bit wild in the world of Nielsen and all the rest of it. But I think we have -- we -- not Brown-Forman, but I mean the industry is showing that the consumer is willing to pay a little bit more for something that tastes really good. And it's been interesting to watch those dynamics.

Absolutely. Thank you for that color. If I could just squeeze in a quick follow-up on Japan specifically. We've observed Brown-Forman evolve the route-to-market process in a number of different markets historically. I've never this much dislocation. So can you just help us think through the 80% decline in Japan and how that evolves over the course of the year? Thanks.

Yeah. So again, we've been working, again, scoping out working on our, increasing our route to consumer in to own distribution models for quite some time. We've had prior to 2020 -- fiscal 2024, we've had 14 markets move into own distribution. We've seen a lot of success. They deliver a lot of things like they fuel our growth, strengthen our position. They do unlock value for us, and we're continuing to move forward in that. So specifically, and this year as it relates to Japan, we are in the process of transition. We know that if you were to look at a year-ago period, we were with our distributor partner, we had inventory in that market to supply the sales, and we're going through just the transition. And so as we -- again, all of this is built into our full year plan. But again, fiscal 2024 for us is going to be a year of transition in Japan. And with that, we have SG&A costs associated with it, and we have a bit of volatility in our inventory levels as we make that transition.

Understood. Thank you.

Thank you. Please stand by for our next question. Our next question comes from the line of Bill Kirk with Roth MKM.

Hi, good morning, everyone. I wanted to ask about your inventory levels, not necessarily the distributor levels. Naturally, they're up from the glass shortage [error] (ph). You highlighted that. However, if I go back further, I have the days up about 25% over fiscal '19. So I guess, how do you feel about the amount of inventory you hold?

So what I would say and you can probably see some of this on a cash flow statement is that, again, as we compare to a prior year period where we were working really, really hard to get all of the supply chain replenished with finished goods inventory, we now have what we've talked about, all of the parts of the chain replenished, including our own inventory. We go into probably the important holiday selling period ready to supply that. So we believe by the time, it's a bit high right now, again, if you look for our own inventories. But as we go through the holiday period, we will, by the end of the year, our plan is that we have that worked down and then our own inventories, too, are back in the normal. That's the last piece of the chain that we will be normalizing and we are ready to make those shipments for the holiday season.

Okay. Excellent. And then there were two comments I want to try to tie together. I think Lawson, you made both of them. One was you mentioned that absent distributor inventory changes, net sales would have been above long-term growth expectations. But you also suggested that 1% depletions are below what people should expect going forward. So I guess how are the net sales ex-shipment timing above long term, but the completions below long term? I'm having a little trouble with those two comments.

Well, that's just going straight to that Schedule D. So that's where we would -- I think Leanne said, if you adjust to the distributor inventory topic, we'd be running it at 8% top-line. So that's the reference to the higher than sort of higher than historical norms in terms of sales growth. And that's the part that gets -- honestly gets us feeling confident because that number is pretty healthy. Now the 1%, I think we talked about that a few minutes ago, there's a lot of RTD movement in there, it's suppressing it. And the other part of it is volumes. We've taken a lot of pricing. I think that contributes to it too because we're getting -- more of our sales growth now is coming from pricing than it has over the historical periods. So it's a little bit of a balance.

Thank you. That’s helpful.

Thank you. Please stand by for our next question. Our next question comes from the line of Steve Powers with Deutsche Bank. Your line is open.

Yes. Hey, good morning. I had two follow-ups on two different questions. The first one, just quickly on the agave topic, Leanne. Is there a way to summarize or quantify the percentage of the company's agave needs that you currently have the capacity to self-grow versus source externally?

We've never shared that and it changes over time depending on the category demand, our finished goods inventory, our liquid inventory. So it does ebb and flow and we do grow our own and we supplement it with the external as we see demand above what we are able to grow ourselves and then our sourcing strategy that's implied in there. So again, we are excited that, that is finally coming down, that supply is coming on. We continue to think that, that's going to be a tailwind for us as we move through F '24 and well through '25.

Okay. Okay. Fair enough. Thank you. And then probably Lawson for you. On Jack & Coke, I was wondering if you could talk at all about sort of the incremental distribution gains, new launches that are planned over the balance of the fiscal year, that should I think at least partially offset the tougher comp in the fourth quarter as you lap the US launch? Any perspective there would be helpful. I’d also love, if you have it, any details on consumer repeat rates or what have you -- the trial has been great. Just curious as to how much of the demand we are seeing is incremental, like first-time trial versus repeated consumption? Thank you very much.

All right. Let me answer the second one first a little bit because it is -- we were obviously getting prepared for this, I knew that question would come. It was very difficult to get sort of turns of repeat purchase rates. It's just too early. We're getting massive distribution flow and that has been impressive and very good. And so we've essentially reached most of our goals in a pretty short period of time. But we just don't have that. We'll have that -- I assume by next quarter, we'll probably have some indications on that, that will be a little bit better, but it's just playing too early. Now as the year -- as the year goes on, the highlight or the highlights, I guess, we've launched in the UK. We've launched in Spain and Poland, and all is going pretty well, and I think we've talked about that. We're really, the big one that's coming is Germany. So that's going to happen in September. And Germany is a very large RTD market for Brown-Forman. And so, sort of getting that right is obviously going to be very important, but that will be exciting to watch, and we'll see how that goes. So -- and then Coca-Cola is taking it in a lot of other -- getting bigger in a lot of other markets, places like Japan, we talked about the Philippines, the UK, Poland, Hungary, Netherlands, Ireland. So the international rollout continues throughout this fiscal year.

Okay. Very good. Thank you so much.

Thank you. Ladies and gentlemen, due to the interest of time, I would now like to turn the call back over to Sue for closing remarks.

Thank you. And thank you to Lawson and Leanne, and thank you to everyone for joining us today for Brown-Forman's first quarter fiscal year 2024 earnings call. If you have any additional questions, please contact us. We do look forward to presenting at the Barclays Global Consumer Staples Conference next week, and we hope to see many of you there. For those of you that are unable to attend, the presentation will be made available as a webcast, accessible via the Brown-Forman corporate website under the section titled Investors, Events and Presentations. We also want to wish everyone an enjoyable weekend, particularly those in the United States that will be celebrating the Labor Day holiday. And on September 2, we hope you will join us in raising a glass as we say happy birthday to our founder, George Garvin Brown. Cheers, everyone. With that, this concludes our call.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.