Brown-Forman (BF-B) 10-K risk factor changes: FY2019 vs FY2018

Unfavorable global or regional economic [removed: conditions, including uncertainty caused by unstable geopolitical environments in many parts of the world,] [added: conditions] could adversely affect our business and financial results.

Unfavorable economic conditions [removed: such as these can] [added: could] cause governments to increase taxes on beverage alcohol to attempt to raise revenue, reducing consumers’ willingness to make discretionary purchases of beverage alcohol products or pay for premium brands such as ours.

Other potential negative consequences to our business from [removed: poor] [added: unfavorable] economic conditions include higher interest rates, an increase in the rate of inflation, deflation, exchange rate fluctuations, credit or capital market instability, or lower returns on pension assets or lower discount rates for pension obligations (possibly requiring higher contributions to our pension plans).

For details on the effects of changes in the value of our benefit plan obligations and assets on our financial results, see Note [removed: 8] [added: 10] to the Consolidated Financial Statements in “Item 8.

Our global business is subject to commercial, political, and financial risks, including foreign currency exchange rate [removed: fluctuations.][added: fluctuations and corruption risk.]

In the long term, we [removed: continue to] expect our growth rates in emerging markets, [removed: such as eastern Europe, Latin America, Asia, and Africa,] to surpass our growth rates in the United States and more developed [removed: markets, such as the United Kingdom, France, Germany, and Australia.][added: markets.]

In addition, we are subject to potential business disruption caused by military conflicts; potentially unstable governments or legal systems; civil or political upheaval or unrest; local labor policies and conditions; possible expropriation, nationalization, or confiscation of assets; problems with repatriation of foreign earnings; economic or trade sanctions; closure of markets to imports; anti-American sentiment; terrorism or other types of violence in or outside the United States; [removed: health pandemics;] and [removed: a significant reduction in global travel.][added: health pandemics.]

For example, [added: last year,] the United States [removed: recently] imposed tariffs on steel and aluminum.

In response, [removed: Mexico has] [added: a number of countries] imposed retaliatory tariffs on U.S. imports, including [added: on] our American whiskey products.

[removed: If implemented, these] [added: Such retaliatory] tariffs [added: continue to remain in place, and any further deterioration of economic relations between the United States and other countries or any increase in tariffs] could [added: result in an] increase [added: in] the price of our products [removed: in these countries] and could prompt consumers to seek alternative products.

For instance, in June 2016, the United Kingdom voted by referendum to leave the European Union (Brexit), and, until the United Kingdom’s exit from the European Union is finalized, [removed: there may be a period of] [added: we face] economic and political uncertainty related to the negotiation of any successor trading arrangement with other countries as well as volatility in exchange rates, risk to supply chains across the European Union, restrictions on the mobility of employees and consumers, or changes to customs duties, tariffs, or industry specific requirements and regulations.

Quantitative and Qualitative Disclosures about Market Risk – Foreign [removed: Exchange.”][added: currency exchange rate risk.”]

Certain countries historically have banned all television, newspaper, magazine, and [removed: internet advertising] [added: digital commerce/advertising] for beverage alcohol products.

Further, our [added: continued] compliance with applicable anti-corruption or other laws, our Code of Conduct, Code of Ethics for Senior Financial Officers, and our other policies could result in higher operating costs.

As a multinational company based in the United States, we are more exposed to the impact of U.S. tax changes than [removed: some] [added: most] of our major competitors, especially those that affect the effective corporate income tax rate.

The Tax Act significantly [removed: revises] [added: revised] the U.S. corporate income tax by, among other things, lowering U.S. corporate income tax rates and implementing a territorial tax system.

[removed: This includes potential] changes in tax rules or the interpretation of tax rules arising out of the Base Erosion & Profit Shifting project initiated by the Organization for Economic Co-operation and Development, as well as changes in the interpretation of tax rules arising out of the European Union State Aid investigations.

Jack Daniel’s is an iconic global trademark with a loyal consumer fan base, and we invest much effort and many resources to protect and preserve the brand’s reputation for [removed: quality,] [added: authenticity,] craftsmanship, and [removed: authenticity.][added: quality.]

Given the importance of Jack Daniel’s to our overall success, a significant or sustained decline in volume or selling price of our Jack Daniel’s products would have a negative effect on our [removed: growth and our stock price.][added: financial results.]

Additionally, should we not be successful in our efforts to maintain or increase the relevance of the Jack Daniel’s brand [removed: in the minds of] [added: to] current and future consumers, our business and operating results could suffer.

Management’s Discussion and Analysis of Financial Condition and Results of Operations – Results of Operations – Fiscal [removed: 2018] [added: 2019] Brand Highlights.”

Changes in consumer preferences and purchases, [removed: and] [added: any decline in the social acceptability of] our [removed: ability to anticipate] [added: products,] or [removed: react] [added: governmental adoption of policies disadvantageous] to [removed: them,] [added: beverage alcohol] could negatively affect our business results.

Consumer preferences and purchases may shift, often in unpredictable ways, due [removed: to a host of] [added: several] factors, including [added: health and wellness trends;] changes in economic conditions, demographic, and social trends; public health policies and initiatives; changes in government regulation of beverage alcohol products; concerns or regulations related to product safety; legalization of marijuana use on a more widespread basis within the United States, Canada, or elsewhere; and changes in [added: trends related to] travel, leisure, dining, gifting, entertaining, and beverage consumption trends.

As [removed: many] more [removed: competitive] brands enter the market, [removed: it] [added: increased competition] could [removed: have a negative impact on the] [added: negatively affect] demand for our premium and super-premium American whiskey brands, including Jack Daniel’s.

In addition, we could experience unfavorable business results if we fail to attract consumers from diverse backgrounds and ethnicities in [removed: the United States and in] [added: all markets where we sell] our [removed: non-U.S. markets.][added: products.]

In particular, we plan to continue to grow Jack Daniel’s Tennessee Honey sales globally and [added: plan] to [removed: further expand our] launch [removed: of] Jack Daniel’s Tennessee [removed: Rye] [added: Apple] in [removed: additional international markets such as] the United [removed: Kingdom, France, Germany, and Canada] [added: States] in fiscal [removed: 2019.][added: 2020.]

Product innovation, [added: particularly for our core brands,] such as our launch of Jack Daniel’s Tennessee [removed: Rye,] [added: Apple,] is a significant element of our growth strategy; however, there can be no assurance that we will continue to develop and implement successful line extensions, packaging, formulation or flavor changes, or new products.

For example, in addition to our American, Canadian, and Irish whiskeys and some tequilas, which are aged for various periods, our [removed: acquisition of] [added: Scotch whisky brands and distilleries including] The GlenDronach, BenRiach, and [added: Glenglassaugh require long-term maturation on average of 12 years with limited releases of 30 years or more, making forecasts of demand for such products in future periods subject to significant uncertainty.]

Any forecasting error could lead to our inability to meet the objectives of our business strategy, failure to meet future demand, or [removed: lead to] a future surplus of inventory and consequent write-down in value of maturing stocks.

In addition, if we were to experience a disruption in the supply of American [added: white] oak logs to produce the new charred oak barrels in which we age our whiskeys, our production capabilities would be compromised.

Higher costs or insufficient availability of suitable grain, agave, water, grapes, wood, glass, closures, and other input materials, or higher associated labor costs or insufficient availability of labor, may adversely affect our financial [removed: results because we may not be able to pass along such cost increases or the cost of such shortages through higher prices to customers without reducing demand or sales.][added: results.]

Our freight cost and the timely delivery of our products could be adversely [removed: impacted] [added: affected] by a number of factors [removed: which] [added: that] could reduce the profitability of our operations, including driver shortages, higher fuel costs, weather conditions, traffic congestion, increased government regulation, and other matters.

International or domestic geopolitical or other events, including the imposition of any tariffs or quotas by governmental authorities on any raw materials that we use in the production of our products, could adversely [removed: impact] [added: affect] the supply and cost of these raw materials to us.

[removed: Weather, the effects of climate change, fires, diseases, and other agricultural uncertainties that affect the mortality,] health, yield, quality, or price of the various raw materials used in our products also present risks for our business, including in some cases potential impairment in the recorded value of our inventory.

If droughts become more common or severe, or if our water supply were interrupted for other reasons, high-quality water could become scarce in some key production regions for our products, including Tennessee, Kentucky, California, Finland, Canada, Mexico, Scotland, and [removed: Ireland.][added: Ireland, which in turn could adversely affect our business and financial results.]

Our ability to sell used [removed: materials] [added: barrels] for reuse may be affected by fluctuations in the market.

For example, [removed: weaker demand from blended Scotch industry buyers,] lower prices, [removed: and] increased [added: competitive] supply of used [removed: barrels] [added: barrels, and weaker demand from Irish and blended scotch industry buyers] may make it difficult to sell our used barrels at sustainable prices and [removed: quantities] [added: quantities,] which could negatively affect our financial results.

While most people who drink enjoy alcoholic beverages in moderation, it is commonly known and well reported that [added: excessive levels or inappropriate patterns of drinking can lead to increased risk of a range of health conditions and, for certain people, can result in alcohol dependence.]

If future scientific research [removed: indicated] [added: indicate] more widespread serious health risks associated with alcohol consumption – particularly with moderate consumption – or if for any reason the social acceptability of beverage alcohol [removed: were to decline] [added: declines] significantly, sales of our products could decrease.

For example, [removed: studies have been conducted] [added: advocacy groups] in Australia and the United Kingdom [removed: to consider] [added: have called for] the [removed: impact] [added: consideration] of requiring the sale of alcohol in plain packaging with more comprehensive health warnings in an effort to change drinking habits in those countries.

Financial Statements and Supplementary Data” and “Item 7A.

Quantitative and Qualitative Disclosures about Market Risk – Foreign currency exchange rate risk.”

In accordance with SAB 118, we recorded an original provisional estimate of the effect of the Tax Act in our 2018 consolidated financial statements and have subsequently finalized our accounting analysis based on the guidance, interpretations, and data available as of December 22, 2018.

For additional detail regarding the Tax Act and the final tax amounts recorded in our consolidated financial statements, see Note 13 to the Consolidated Financial Statements in “Item 8.

This includes potential

Weather, the effects of climate change, fires, diseases, and other agricultural uncertainties that affect the mortality,

The various uses of these IT systems, networks, and services include, but are not limited to: hosting our internal network and communication systems; ordering and managing materials from suppliers; supply/demand planning; production;

In the ordinary course of our business, we receive, process, transmit, and store information relating to identifiable individuals (personal data), primarily employees and former employees, but also relating to consumers.

As a result, we are subject to various U.S. federal and state and foreign laws and regulations relating to personal data.

These laws have been subject to frequent changes, and new legislation in this area may be enacted in other jurisdictions at any time.

In the European Union, the General Data Protection Regulation (GDPR) became effective on May 25, 2018, for all member states and it has extraterritorial effect.

The GDPR includes operational requirements for companies receiving or processing personal data of European Union residents that are partially different from those that had previously been in place and includes significant penalties for noncompliance.

The changes introduced by the GDPR, as well as any other changes to existing personal data protection laws and the introduction of such laws in other jurisdictions, have subjected and may continue in the future to subject us to, among other things, additional costs and expenses and have required and may in the future require costly changes to our business practices and security systems, policies, procedures, and practices.

Improper disclosure of personal data in violation of the GDPR and/or of other personal data protection laws could harm our reputation, cause loss of consumer confidence, subject us to government enforcement actions (including fines), or result in private litigation against us, which could result in loss of revenue, increased costs, liability for monetary damages, fines and/or criminal prosecution, all of which could negatively affect our business and operating results.

We have had

While the major economic disruptions of the most recent financial crisis have largely subsided, many markets where our products are sold still face significant economic challenges resulting from the global economic downturn that followed, including low consumer confidence, high unemployment, budget deficits, burdensome governmental debt, austerity measures, increased taxes, and weak financial, credit, and housing markets.

For example, Russia has enacted legislation that empowers its president to implement a partial or total ban on the importation of goods and products from and produced by companies under the jurisdiction of the United States and other “unfriendly” foreign countries.

If such legislation were to be implemented, the sale of our products in Russia, especially Jack Daniel’s Tennessee Whiskey, could be significantly and adversely affected.

The European Union and several other countries have threatened to follow suit.

In accordance with SAB 118, we have recognized the provisional tax impacts related to the repatriation tax and the re-measurement of deferred tax assets and liabilities.

Ultimately, the actual impact of the Tax Act may differ from our provisional estimates, possibly materially, due to, among other things, the significant complexity of the Tax Act, anticipated additional regulatory guidance, or related interpretations that may be issued by the Internal Revenue Service, changes in accounting standards, legislative actions, future actions by states within the U.S. and changes in estimates, analyses, interpretations, and assumptions we have made.

For example, in 2017, the United Kingdom increased its tax on beer, cider, wine, and spirits by 3.9%, providing a potential source of revenue to fund its post-Brexit obligations.

In addition to indirect taxes, our global business can also be negatively affected by trade barriers and other governmental protectionist measures, any of which can be imposed suddenly and unpredictably.

Recently, retaliatory tariffs have been imposed by Mexico and threatened by the European Union, Canada, Russia, China, and several other countries following the imposition of tariffs on steel and aluminum by the United States.

Mexico’s new tariffs on bourbon, and tariffs typically, take the form of value-added levies on U.S.-sourced products.

As an example, a tariff on American whiskey would result in either reduced margins or increased consumer prices, either of which could adversely impact our financial results and demand for our products.

Glenglassaugh Scotch whisky brands and distilleries introduce a new category of inventory, which require long-term maturation of 30 years or more, making forecasts of demand for such products in future periods subject to significant uncertainty.

If the social acceptability of our products declines, or governments adopt policies disadvantageous to beverage alcohol, our business could be adversely affected.

excessive levels or inappropriate patterns of drinking can lead to increased risk of a range of health conditions and, for certain people, can result in alcohol dependence.

Furthermore, health and wellness trends over the past several years may result in a shift in consumer preferences away from alcoholic beverages.

We could incur future restructuring charges or record impairment losses on the value of goodwill or other intangible assets resulting from previous acquisitions, which may also negatively affect our financial results.

While these

Negative publicity could affect our stock price and business performance.

Unfavorable publicity, whether accurate or not, related to our industry or to us or our brands, marketing, personnel, operations, business performance, or prospects could negatively affect our corporate reputation, stock price, ability to attract high-quality talent, or the performance of our business.

Adverse publicity or negative commentary on social media outlets, particularly any that go “viral,” could cause consumers to react by avoiding our brands or choosing brands offered by our competitors, which could materially negatively affect our financial results.

| Presentation basis. This MD&A reflects the basis of presentation described in Note 1 “Accounting Policies” to the Consolidated Financial Statements. In addition, we define statistical and non-GAAP financial measures that we believe help readers understand our results of operations and the trends affecting our business. | [removed: [26](#s5CFC4B29FBB659F08BFD5240CD0CCA0E)] [added: [30](#s53E7943973575174BFFE81F203770E56)] |

| Significant developments. We discuss developments during the most recent three fiscal years. Please read this section in conjunction with “Item 1. Business,” which provides a general description of our business and strategy. | [removed: [29](#sCBA619ADC86F54CF9AED023FEC0B2181)] [added: [34](#sE4C0A9688AE65ED28D86B4A5CBC698F6)] |

| Executive summary. We discuss (a) fiscal [removed: 2018] [added: 2019] highlights and (b) our outlook for fiscal [removed: 2019,] [added: 2020,] including the trends, developments, and uncertainties that we expect to affect our business. | [removed: [30](#s533ABC9C1FC15F8693D46EF8D5F17151)] [added: [36](#sC134AE28DD1A5533A22B997590F4FA41)] |

| Results of operations. We discuss (a) fiscal [removed: 2018] [added: 2019] results for our largest markets, (b) fiscal [removed: 2018] [added: 2019] results for our largest brands, and (c) the causes of year-over-year changes in our [removed: income statement] [added: statements of operations] line items, including transactions and other items that affect the comparability of our results, for fiscal [removed: years 2017] [added: year 2019] and 2018. | [removed: [32](#sB3C21ACDD0E45ECCBFD0506657A49E7A)] [added: [39](#s5DC7914E4C3851D9986C38175E230FE9)] |

| Liquidity and capital resources. We discuss (a) the causes of year-over-year changes in cash flows from operating activities, investing activities, and financing activities; (b) recent and expected future capital expenditures; (c) dividends and share repurchases; and (d) our liquidity position, including capital resources available to us. | [removed: [42](#sEFFEC87483FA56B191B9993D018FB184)] [added: [48](#sFE23EA6DE4B6562386FA1B74B4D0B938)] |

| Off-balance sheet arrangements and long-term obligations. | [removed: [44](#sF13F757CAB4D59ECA605EAAB39A154E1)] [added: [50](#sDBFAC08FE2515376B319124C03B9DA51)] |

| Critical accounting policies and estimates. We discuss the critical accounting policies and estimates that require significant management judgment. | [removed: [45](#s4440024F4C355F4BBFAFB6CF7CC813B3)] [added: [51](#s63CE73EB70C458E8814B149F400DB3D1)] |

[removed: “Underlying change”] [added: | Change] in [added: underlying operating] income [removed: statement measures.][added: | 6 | % | | 5 | % |]

We present changes in certain [removed: income statement] measures, or line items, [added: of the statements of operations] that are adjusted to an “underlying” basis.

We use “underlying change” for the following [removed: income statement measures:] [added: measures of the statements of operations:] (a) underlying net sales; (b) underlying cost of sales; (c) underlying gross profit; (d) underlying advertising expenses; (e) underlying selling, general, and administrative (SG&A) expenses; (f) underlying other expense [removed: (income);] [added: (income) net;] (g) underlying operating [removed: expenses;1] [added: expenses1;] and (h) underlying operating income.

To calculate these measures, we adjust, as applicable, for (a) acquisitions and divestitures, (b) [added: a new accounting standard, (c)] foreign exchange, [removed: (c)] [added: (d)] estimated net changes in distributor inventories, and [removed: (d)] [added: (e)] the establishment of our charitable foundation.

With respect to comparisons of fiscal [removed: 2017 to fiscal 2016, the non-comparable period comprised all months; with respect to comparisons of fiscal] 2018 to fiscal 2017, the non-comparable period is the month of May.

| • | “Foreign exchange.” We calculate the percentage change in [removed: our income statement] [added: certain] line items [added: of the statements of operations] in accordance with GAAP and adjust to exclude the cost or benefit of currency fluctuations. Adjusting for foreign exchange allows us to understand our business on a constant-dollar basis, as fluctuations in exchange rates can distort the underlying trend both positively and negatively. (In this report, “dollar” always means the U.S. dollar unless stated otherwise.) To eliminate the effect of foreign exchange fluctuations when comparing across periods, we translate current-year results at prior-year rates and remove [added: transactional and hedging] foreign exchange gains and losses from current- and prior-year periods. |

| • | “Estimated net change in distributor inventories.” This adjustment refers to the estimated net effect of changes in distributor inventories on changes in [removed: our income statement] [added: certain] line [removed: items.] [added: items of the statements of operations.] For each period compared, we use volume information from our distributors to estimate the effect of distributor inventory changes [added: in certain line items of the statements of operations. We believe that this adjustment reduces the effect of varying levels of distributor inventories] on [removed: our income statement] [added: changes in certain] line [removed: items.] [added: items of the statements of operations and allows us to understand better our underlying results and trends.] |

| • | “Foundation.” In [removed: the fourth quarter of] fiscal 2018, we established the Brown-Forman Foundation (the Foundation) with an initial $70 million contribution to support the [removed: company’s] [added: Company’s] charitable giving program in the communities where our employees live and work. This adjustment removes the initial $70 million contribution to the Foundation from our underlying SG&A expenses and underlying operating income to present our underlying results on a comparable basis. |

We use the non-GAAP measures “underlying [removed: change”:] [added: change” to:] (a) [removed: to] understand our performance from period to period on a consistent basis; (b) [removed: to] compare our performance to that of our competitors; (c) [removed: in connection with] [added: calculate components of] management incentive [removed: compensation calculations;] [added: compensation;] (d) [removed: in our planning] [added: plan] and [removed: forecasting processes;] [added: forecast;] and (e) [removed: in communications concerning] [added: communicate] our financial performance [removed: with] [added: to] the board of directors, stockholders, and investment analysts.

We [removed: reconcile] [added: provide reconciliations of] the “underlying [removed: changes] [added: change”] in [removed: income statement measures”] [added: certain line items of the statements of operations] to their nearest GAAP measures in the tables [removed: below] under “Results of Operations - Year-Over-Year Comparisons.” We have consistently applied the adjustments within our reconciliations in arriving at each non-GAAP measure.

From time to time, to explain our results of operations or to highlight trends and uncertainties affecting our business, we aggregate markets according to stage of economic development as defined by the International Monetary Fund [removed: (IMF)] [added: (IMF),] and we aggregate brands by spirits category.

Below, we define the [added: geographic and brand] aggregations used in this report.

| • | [removed: “Developed”] [added: “Developed International”] markets are “advanced economies” as defined by the [removed: IMF.] [added: IMF, excluding the United States.] Our largest developed [added: international] markets are the United [removed: States, the United] Kingdom, [added: Australia, Germany, France,] and [removed: Australia. Developed international markets are developed markets excluding the United States.] [added: Japan. This aggregation represents our net sales of branded products to these markets.] |

| • | “Emerging” markets are “emerging and developing economies” as defined by the IMF. Our largest emerging markets are [removed: Mexico] [added: Mexico, Poland, Russia,] and [removed: Poland.] [added: Brazil. This aggregation represents our net sales of branded products to these markets.] |

In “Results of Operations - Fiscal [removed: 2018] [added: 2019] Market Highlights,” we provide supplemental information for our largest markets ranked by percentage of total fiscal [removed: 2018] [added: 2019] net sales.

| • | “Travel Retail” represents our [added: net] sales [added: of branded products] to global duty-free customers, [added: other] travel retail customers, and the U.S. [removed: military.] [added: military regardless of customer location.] |

| • | [removed: “Other non-branded”] [added: “Non-branded and bulk”] includes [added: our net sales of] used [removed: barrel,] [added: barrels,] bulk whiskey and wine, and contract bottling [removed: sales.] [added: regardless of customer location.] |

| • | “Premium [removed: bourbon” products include] [added: bourbons” includes] Woodford Reserve, Old Forester, and Coopers’ Craft. |

| • | “American whiskey” [removed: products include] [added: includes] the Jack Daniel’s family of brands, premium [removed: bourbons,] [added: bourbons (defined below),] and Early Times. |

| • | “Tequila” [removed: products include] [added: includes] el Jimador, Herradura, New Mix, Pepe Lopez, and Antiguo. |

In “Results of Operations - Fiscal [removed: 2018] [added: 2019] Brand Highlights,” we provide supplemental information for our largest brands ranked by percentage of total fiscal [removed: 2018] [added: 2019] net sales.

| • | “Jack Daniel’s family of brands” includes Jack Daniel’s Tennessee Whiskey (JDTW), Jack Daniel’s RTD and RTP products (JD [removed: RTDs/RTP),] [added: RTD/RTP),] Jack Daniel’s Tennessee Honey (JDTH), Gentleman Jack, Jack Daniel’s Tennessee Fire (JDTF), Jack Daniel’s Single Barrel [removed: Collection,] [added: Collection (JDSB),] Jack Daniel’s Tennessee Rye Whiskey (JDTR), Jack Daniel’s Sinatra Select, [removed: and] Jack Daniel’s No. 27 Gold Tennessee [removed: Whiskey.] [added: Whiskey, and Jack Daniel’s Bottled-in-Bond.] |

| • | “Jack Daniel’s [removed: RTDs/RTP”] [added: RTD and RTP”] products include all RTD line extensions of Jack Daniel’s, such as Jack Daniel’s & Cola, Jack Daniel’s & Diet Cola, Jack & Ginger, Jack Daniel’s Country Cocktails, Gentleman Jack & Cola, Jack Daniel’s Double Jack, Jack Daniel’s American Serve, Jack Daniel’s Tennessee Honey RTD, Jack Daniel’s Cider (JD Cider), Jack Daniel’s Lynchburg Lemonade (JD Lynchburg Lemonade), and the seasonal Jack Daniel’s Winter Jack RTP. |

| • | “Depletions.” We generally record revenues when we ship our products to our customers. [removed: Depending on our route-to-consumer (RTC), we ship products to either (a) retail or wholesale customers in owned distribution markets or (b) our distributor customers in other markets. “Depletions”] [added: Depletions] is a term commonly used in the beverage alcohol industry to describe volume. Depending on the context, [removed: “depletions”] [added: depletions] means either (a) our shipments directly to retail or wholesale customers for owned distribution markets or (b) shipments from our distributor customers to retailers and wholesalers in other markets. We believe that depletions measure volume in a way that more closely reflects consumer demand than our shipments to distributor customers do. In this document, unless otherwise specified, we refer to [removed: “depletions”] [added: depletions] when discussing volume. |

| • | “Consumer takeaway.” When discussing trends in the market, we refer to [removed: “consumer takeaway,”] [added: consumer takeaway,] a term commonly used in the beverage alcohol industry. [removed: “Consumer takeaway”] [added: Consumer takeaway] refers to the purchase of product by [removed: the consumer] [added: consumers] from [removed: a] retail [removed: outlet] [added: outlets] as measured by volume or retail sales value. This information is provided by third parties, such as Nielsen and the National Alcohol Beverage Control Association (NABCA). Our estimates of market share or changes in market share are derived from consumer takeaway data using the retail sales value metric. [added: We believe consumer takeaway is a leading indicator of how consumer demand is trending.] |

We use this non-GAAP measure because we consider return on average invested capital to be a meaningful indicator of how effectively and efficiently we [removed: use] [added: invest] capital [removed: invested] in our business.

Below we discuss the significant developments in our business during fiscal [removed: 2016, fiscal] 2017, [added: fiscal 2018,] and fiscal [removed: 2018.][added: 2019.]

| • | Jack Daniel’s family of brands. Innovation within the Jack Daniel’s family of brands has [removed: driven] [added: contributed to our] growth over the last three [removed: years:] [added: years as described below. In addition, we recently announced the launch of Jack Daniel’s Tennessee Apple, which we expect to introduce in the United States in the fall of 2019.] |

| ◦ | In fiscal 2018, we introduced several new [removed: Jack Daniel’s] [added: JD] RTD products, including Jack Daniel’s Southern Peach Country Cocktails in the United [removed: States, Jack Daniel’s Cider in the United Kingdom,] [added: States] and Jack Daniel’s Lynchburg Lemonade in Germany. These introductions [removed: all] contributed to our [removed: Jack Daniel’s] [added: JD] RTD growth in those markets. |

| ◦ | In fiscal 2018, we introduced [removed: JDTR,] [added: Jack Daniel’s Tennessee Rye (JDTR),] the first full-strength whiskey [added: with a different grain recipe] from the Jack Daniel’s family of brands in over two decades, in the United States and certain international markets. [removed: With this successful launch, our total Rye whiskey portfolio,] [added: In fiscal 2019, we expanded JDTR to several additional markets] including [removed: Woodford Reserve Rye Whiskey] [added: France, Travel Retail, Germany,] and [removed: Jack Daniel’s Single Barrel Rye, surpassed 100,000 nine-liter cases in fiscal 2018.] [added: Poland.] |

| • | Other American whiskeys. We continue to capitalize on consumers’ interest in [removed: super- and ultra-premium] [added: premium plus] whiskey with our [added: wide] range of brands, including Woodford [removed: Reserve and] [added: Reserve,] Old [removed: Forester.] [added: Forester, and Coopers’ Craft.] |

| ◦ | In fiscal 2017, we unveiled new packaging for Woodford Reserve Double Oaked, the most successful line extension from Woodford Reserve to date (first introduced in 2012). The Double Oaked variant of Woodford Reserve continued to contribute meaningfully to the brand’s growth and [removed: reached nearly] [added: surpassed] 50,000 nine-liter cases in fiscal 2018. [added: We introduced a new in Woodford Reserve Straight Malt in fiscal 2019.] |

| ◦ | [removed: Also in] [added: In] fiscal 2017, we introduced our first entirely new bourbon in 20 years, Coopers’ Craft, a super-premium brand now in limited distribution in the United States. [added: In fiscal 2019, we unveiled new packaging for Coopers’ Craft and introduced Coopers’ Craft Barrel Reserve.] |

| Reclassifications. We discuss retrospective adjustments to our prior year statements of operations during fiscal years 2018 and 2017. Please read this section in conjunction with Note 2 to the accompanying financial statements. | [33](#s6BB89F745AF05B95B489905B4637B24E) |

“Underlying change” in measures of statements of operations.

| • | “New accounting standard.” Under Accounting Standards Codification (ASC) 606, “Revenue from Contracts with Customers,” we recognize the cost of certain customer incentives earlier than we did before adopting ASC 606. Although this change in timing did not have a significant impact on a full-year basis, there was some change in the timing of recognition across periods. Additionally, some payments to customers that we classified as expenses before adopting the new standard are classified as reductions of net sales under our new policy. See Note 2 to the accompanying financial statements for additional information. This adjustment allows us to look at underlying change on a comparable basis. |

| • | “Whiskey” includes all whiskey spirits and whiskey-based flavored liqueurs, ready-to-drink (RTD), and ready-to-pour products (RTP). The brands included in this category are the Jack Daniel's family of brands, Woodford Reserve, Canadian Mist, GlenDronach, BenRiach, Glenglassaugh, Old Forester, Early Times, Slane Irish Whiskey, and Coopers’ Craft. |

| • | “Vodka” includes Finlandia. |

| • | “Non-branded and bulk” includes our net sales of used barrels, bulk whiskey and wine, and contract bottling regardless of customer location. |

Reclassifications

As discussed in Note 2 to the accompanying financial statements, we retrospectively adjusted our prior year statements of operations in connection with the adoption of Accounting Standards Update (ASU) 2017-07, “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost.” We also reclassified some previously reported expense amounts related to certain marketing research and promotional agency costs.

The impact of these changes, which had no effect on net income, was not material.

The following tables reconcile the previously reported amounts to the currently reported amounts in the statements of operations for fiscal years 2017 and 2018.

| | | | | | | | | | | | | | | | |

| (Dollars in millions) | Previously Reported | | | | Adoption of ASU 2017-07 | | | | Reclassifications | | | | Currently Reported | | |

| Cost of sales | 973 | | | | — | | | | — | | | | 973 | | |

| Gross profit | 2,021 | | | | — | | | | — | | | | 2,021 | | |

| Advertising expenses | 383 | | | | — | | | | (11 | | ) | | 372 | | |

| Selling, general, and administrative expenses | 667 | | | | (21 | | ) | | 11 | | | | 657 | | |

| Other expense (income), net | (18 | | ) | | — | | | | — | | | | (18 | | ) |

| Non-operating postretirement expense | — | | | | 21 | | | | — | | | | 21 | | |

| Interest income | (3 | | ) | | — | | | | — | | | | (3 | | ) |

| Interest expense | 59 | | | | — | | | | — | | | | 59 | | |

| Income before income taxes | 933 | | | | — | | | | — | | | | 933 | | |

| Income taxes | 264 | | | | — | | | | — | | | | 264 | | |

| Net income | $ | 669 | | | $ | — | | | $ | — | | | $ | 669 | |

| | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | |

| (Dollars in millions) | Previously Reported | | | | Adoption of ASU 2017-07 | | | | Reclassifications | | | | Currently Reported | | |

| Net sales | $ | 3,248 | | | $ | — | | | $ | — | | | $ | 3,248 | |

| Cost of sales | 1,046 | | | | — | | | | — | | | | 1,046 | | |

| Gross profit | 2,202 | | | | — | | | | — | | | | 2,202 | | |

| Advertising expenses | 414 | | | | — | | | | (9 | | ) | | 405 | | |

| Selling, general, and administrative expenses | 765 | | | | (9 | | ) | | 9 | | | | 765 | | |

| Other expense (income), net | (16 | | ) | | — | | | | — | | | | (16 | | ) |

| Operating income | 1,039 | | | | 9 | | | | — | | | | 1,048 | | |

| Non-operating postretirement expense | — | | | | 9 | | | | — | | | | 9 | | |

| Interest income | (6 | | ) | | — | | | | — | | | | (6 | | ) |

| Interest expense | 68 | | | | — | | | | — | | | | 68 | | |

| Income before income taxes | 977 | | | | — | | | | — | | | | 977 | | |

| Income taxes | 260 | | | | — | | | | — | | | | 260 | | |

| Net income | $ | 717 | | | $ | — | | | $ | — | | | $ | 717 | |

All share and per share amounts have been adjusted for a 5-for-4 stock split in February 2018 (see Note 10 to the Consolidated Financial Statements for additional information).

| | |

| --- | --- |

| • | “Rest of Europe” includes all markets in Europe and the Commonwealth of Independent States other than those specifically listed. |

| • | “Remaining geographies” represents all markets (approximately 110) other than those specifically listed or included in “Rest of Europe,” with the largest being Brazil, South Africa, and China. |

| • | “Drinks-equivalent.” Volume is discussed on a nine-liter equivalent unit basis (nine-liter cases) unless otherwise specified. At times, we use a “drinks-equivalent” measure for volume when comparing single-serve ready-to-drink (RTD) or ready-to-pour (RTP) brands to a parent spirits brand. “Drinks-equivalent” depletions are RTD and RTP nine-liter cases converted to nine-liter cases of a parent brand on the basis of the number of drinks in one nine-liter case of the parent brand. To convert RTD volumes from a nine-liter case basis to a drinks-equivalent nine-liter case basis, RTD nine-liter case volumes are divided by 10, while RTP nine-liter case volumes are divided by 5. |

We reconcile each of these measures to their nearest GAAP measures in the tables below under “Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations – Executive Summary.” We have consistently applied the adjustments within our reconciliations in arriving at each non-GAAP measure.

| ◦ | We introduced our second Jack Daniel’s flavored whiskey product, JDTF, starting with the United States in late fiscal 2015. In fiscal 2016, we completed the U.S. launch and continued the global rollout of JDTF. In fiscal 2017, we expanded JDTF to markets including France, Germany, and Travel Retail. In fiscal 2018, we expanded JDTF to Brazil and Chile. |

| ◦ | From fiscal 2015 to fiscal 2017, we introduced three Old Forester craft expressions in our Old Forester Whiskey Row Series. In fiscal 2018, we added Old Forester Statesman, which won a double gold medal at the 2018 San Francisco World Spirits Competition. In addition, we launched new packaging for our core Old Forester bourbons in February 2017. Our founding brand grew net sales by more than 35% per year from fiscal 2015 through fiscal 2018. |

| • | In March 2016, we sold our Southern Comfort and Tuaca brands and related assets to Sazerac Company, Inc. for $543 million in cash, which resulted in a gain of $485 million in the fourth quarter of fiscal 2016. We substantially completed all activities related to this transition of ownership in fiscal 2017. See ‘‘Executive Summary’’ below and Note 15 to the Consolidated Financial Statements for additional information about the financial impact of the sale of Southern Comfort and Tuaca. |

| • | On June 1, 2016, we acquired The BenRiach Distillery Company Limited (BenRiach) for aggregate consideration of $407 million, consisting of a purchase price of $341 million and $66 million in assumed debt and transaction-related obligations that we have since paid. The acquisition, which brought three single malt Scotch whisky brands into our portfolio, included brand trademarks, inventories, three homeplaces, three malt distilleries, a bottling plant, and BenRiach’s headquarters in Edinburgh, Scotland. We believe that these super-premium brands will provide us an opportunity to participate in the growing single malt Scotch category and strengthen our portfolio’s long-term growth prospects in the United States, the United |

Kingdom, Taiwan, Germany, and Travel Retail.

| ◦ | From a geographic perspective, the United States and emerging markets led the growth in underlying net sales, while developed international markets also accelerated underlying net sales growth compared to fiscal 2017. |

| • | We delivered diluted earnings per share of $1.48, an increase of 8% compared to fiscal 2017 due to an increase in reported operating income and a reduction in our effective tax rate. |

| • | Our return on average invested capital increased to 20.0% in fiscal 2018, compared to 19.8% in fiscal 2017. |

| Advertising | 417 | | | | 383 | | | | 414 | | | | (8 | %) | | 8 | % | | 2 | % | | 6 | % |

| SG&A | 688 | | | | 667 | | | | 765 | | | | (3 | %) | | 15 | % | | (2 | %) | | 3 | % |

| Operating expenses2 | 35.5 | | % | | 34.5 | | % | | 35.8 | | % | | (1.0 | pp) | | 1.3 | pp | | | | | | |

| Operating income | 49.6 | | % | | 33.0 | | % | | 32.0 | | % | | (16.6 | pp) | | (1.0 | pp) | | | | | | |

| • | Underlying expenses. We expect total underlying expenses to grow more slowly than net sales. In addition, we expect: (a) for underlying cost of sales, input costs should increase in the mid-single digits, (b) underlying advertising expenses should grow at a rate similar to our net sales growth rate, and (c) underlying SG&A expenses to be approximately unchanged compared to fiscal 2018. |

| • | Revenue from Contracts with Customers. In fiscal 2019, we will implement ASU 2014-09, which replaces existing revenue recognition guidance. We have concluded that adoption will not have a material impact on our financial statements. However, |

under the new standard, we will estimate and recognize the cost of certain customer incentives earlier than we have historically.

Although we expect this change in timing to shift the recognition of these costs among fiscal quarters, we do not expect the full-year impact to be significant.

Additionally, some payments to customers previously classified as advertising or SG&A expenses will be classified as reductions of net sales under the new standard.

We anticipate the impact of this change in classification to be insignificant.

See Note 1 to the Consolidated Financial Statements for additional information.

| • | Productivity and efficiency initiative. In June 2017, we announced a three-year (fiscal 2018 – fiscal 2020) cost-saving and productivity initiative to deliver sustainable cost savings and accelerate our net sales growth rate. We expect to invest a portion of the cost savings generated by the initiative in incremental advertising and promotional activities. Our fiscal 2019 outlook reflects this initiative’s expected effects. |

| • | Tax Act. In December 2017, the U.S. government enacted the Tax Cuts and Jobs Act (Tax Act), which significantly revises the U.S. corporate income tax by lowering the U.S. corporate income tax rate. During fiscal 2018, we recorded a provisional net charge of $43 million related to the transitional impacts of the Tax Act. Our fiscal 2019 effective tax rate will not include these transitional impacts of the Tax Act and will include a full year of the lower U.S. corporate income tax rate. See Note 12 to the Consolidated Financial Statements for additional information. |

| • | Foundation. In fiscal 2018, we established the Brown-Forman Foundation with an initial contribution of $70 million, which we do not expect to repeat in fiscal 2019. The expense recorded to establish the Foundation was removed from our underlying change in fiscal 2018 SG&A and operating income measures. See “Non-GAAP Financial Measures” above for details. |

| • | Tariffs. In response to the U.S. tariffs on steel and aluminum, the European Union and several other countries including Canada, China, Russia, and Turkey have threatened retaliatory tariffs. In addition, Mexico has imposed retaliatory tariffs on U.S. goods, including American whiskey. We have a significant U.S. manufacturing base and export our American whiskeys around the world. As the extent of any potential tariffs from key U.S. trading partners is uncertain, their potential impact on our business is unknown. We continue to monitor this situation and consider measures to mitigate risk. |

| Europe | | 27 | % | | 12 | % | — | % | (4 | %) | — | % | | 8 | % |

| Rest of Europe | | 8 | % | | 12 | % | — | % | (5 | %) | 2 | % | | 9 | % |

| Canada | | 1 | % | | 2 | % | — | % | (1 | %) | 2 | % | | 3 | % |

| Remaining geographies | | 7 | % | | 3 | % | — | % | (1 | %) | 3 | % | | 5 | % |

The United States, our most important market, accounted for 47% of our reported net sales in fiscal 2018, down from 48% in fiscal 2017.

In fiscal 2018, reported net sales in the United States grew 7%, while underlying net sales increased 5%, after adjusting for an estimated net increase in distributor inventories.

Underlying net sales gains were fueled by (a) the Jack Daniel’s family of brands, led by JDTW, JDTH, and the launch of JDTR; (b) our premium bourbon brands, led by Woodford Reserve and Old Forester; and (c) the growth of our tequila brands.

This growth was partially offset by declines of Korbel Champagne and Canadian Mist.

Europe accounted for 27% of our reported net sales in fiscal 2018, up from 26% in fiscal 2017.

[removed: | • | Our Enterprise Risk Management Committee, composed of managers from an array of levels, functions, and geographies, reports to the Board at least annually. It leads our risk management program globally, which systematically identifies and evaluates the major] risks we face, [removed: identifies] [added: identifying] people responsible for managing each risk, [removed: ensures] [added: ensuring] that risk mitigation plans are in place and, together with internal audit, [removed: verifies] [added: verifying] that mitigation plans are being followed. [removed: |]

| • | Our Risk Management function identifies and assesses potential operational hazards and safety and security risks, and facilitates ongoing communication about those risks with [removed: the Enterprise Risk Management Committee and] our executive leaders. Within Risk Management, our crisis management team facilitates simulations with the appropriate function and executive leaders to increase awareness and preparedness. |

| • | The Chief [removed: Ethics] [added: Ethics, Compliance,] and [removed: Compliance] [added: Risk] Officer helps ensure that all of our employees’ actions globally comply with all applicable laws, our Code of Conduct, and our internal policies. The Chief [removed: Ethics] [added: Ethics, Compliance,] and [removed: Compliance] [added: Risk] Officer reports the status of our compliance efforts four times a year to the Audit Committee. |

We [removed: are exposed to] [added: face] market risks arising from [removed: adverse] changes in foreign [added: currency] exchange rates, commodity [removed: prices affecting the cost of our raw materials and energy,] [added: prices,] and interest rates.

See Notes [removed: 6] [added: 14] and [removed: 7] [added: 15] to the Consolidated Financial Statements in “Item 8.

Financial Statements and Supplementary Data” (the Consolidated Financial Statements) for additional [removed: information.][added: information on our foreign currency exchange rate risk.]

See Note [removed: 4] [added: 6] to the Consolidated Financial Statements for details on our grape and agave purchase obligations, which are exposed to commodity price risk, and “Critical Accounting Policies and Estimates” in “Item 7.

As of April 30, [removed: 2018,] [added: 2019,] our cash and cash equivalents [removed: ($239] [added: ($307] million) and variable-rate debt [removed: ($215] [added: ($150] million) [removed: are] [added: were] exposed to [removed: the risk of] interest rate changes.

Based on the [removed: net balance] [added: then-existing balances] of these items, a [removed: 1%] [added: hypothetical one percentage point] increase in interest rates would result in a negligible decrease in net interest expense.

| • | Our Chief Ethics, Compliance, and Risk Officer is responsible for Enterprise Risk Management and reports to the Board at least annually. Our Enterprise Risk Management program includes systematically identifying and evaluating the major |

We manage market risks through procurement strategies as well as the use of derivative and other financial instruments.

Our risk management program is governed by policies that authorize and control the nature and scope of transactions that we use to mitigate market risks.

Our policy permits the use of derivative financial instruments to mitigate market risks but prohibits their use for speculative purposes.

Foreign currency exchange rate risk.

Foreign currency fluctuations affect our net investments in foreign subsidiaries and foreign currency-denominated cash flows.

In general, we expect our cash flows to be negatively affected by a stronger dollar and positively affected by a weaker dollar.

Our most significant foreign currency exposures include the euro (EUR), the British pound (GBP), the Australian dollar (AUD), the Polish zloty (PLN), the Mexican peso (MXN), and the Russian ruble (RUB).

We manage our foreign currency exposures through derivative financial instruments, principally foreign currency forward contracts, and debt denominated in foreign currency.

We had outstanding currency derivatives with notional amounts totaling $1,098 million and $1,241 million at April 30, 2018 and 2019, respectively.

We estimate that a hypothetical 10% weakening of the dollar compared to exchange rates of hedged currencies as of April 30, 2019, would decrease the fair value of our then-existing foreign currency derivative contracts by approximately $51 million.

This hypothetical change in fair value does not consider the expected inverse change in the underlying foreign currency exposures.

Commodity price risk.

Commodity price changes can affect our production and supply chain costs.

Our most significant commodities exposures include corn, malted barely, rye, natural gas, agave, and wood.

We manage certain exposures through a combination of purchase orders and long-term supply contracts.

Interest rate risk.

Interest rate changes affect (a) the fair value of our fixed-rate debt, and (b) cash flows and earnings related to our variable-rate debt and interest-bearing investments.

In addition to currently outstanding debt, any potential future debt offerings are subject to interest rate risk.

Our interest rate exposures include U.S. Treasury rates, European Central Bank rates, British government rates, and LIBOR.

We try to manage risk responsibly through a variety of strategies, including production initiatives and hedging.

Our foreign currency hedging contracts are subject to exchange rate changes, our commodity forward purchase contracts are subject to commodity price changes, and some of our debt obligations are subject to interest rate changes.

Below, we discuss these exposures and provide a sensitivity analysis as to how these changes could affect our results of operations.

Foreign Exchange.

The more we expand our business outside the United States, the more our financial results will be exposed to exchange rate fluctuations.

This exposure includes sales of our products in currencies other than the dollar and the cost of goods, services, and manpower we purchase in currencies other than the dollar.

Because we sell more in local currencies than we purchase, we have a net exposure to changes in the dollar’s value.

Foreign exchange rates also affect the carrying value of our foreign-currency-denominated assets and liabilities.

To buffer these exchange rate fluctuations, we regularly hedge a portion of our foreign currency exposure.

But over the long term, our reported financial results will generally be negatively affected by a stronger dollar and positively affected by a weaker dollar.

We estimate that our foreign currency revenue will exceed our foreign currency expenses by $807 million in fiscal 2019.

We hedge those currencies considered to be significant exposures based on value at risk; the estimated transactional exposure for the hedged currencies is $734 million.

We use foreign currency forward contracts to hedge a portion of our transactional foreign exchange risk and, in some circumstances, our net asset exposure.

If these contracts remain effective, we will not recognize any unrealized gains or losses until we either recognize the underlying hedged transactions in earnings or convert the underlying hedged net asset exposures.

At April 30, 2018, our total foreign currency hedges had a notional value of $1,098 million, with a maximum term outstanding of 36 months, and were recorded as a net liability at their fair value of $38 million.

As of April 30, 2018, we hedged 64% of the estimated fiscal 2019 transactional exposure for hedged currencies by entering into foreign currency forward contracts.

Considering these hedges and spot rates as of April 30, 2018 compared to fiscal 2018’s effective exchange rates, we expect a modest negative effect to our fiscal 2019 operating income.

We estimate that a 10% increase/decrease in the average value of the dollar in fiscal 2019 relative to spot rates as of April 30, 2018 would decrease/increase our fiscal 2019 operating income by approximately $35 million.

Commodity Prices.

Commodity prices are affected by weather, supply and demand, as well as geopolitical and economic variables.

To reduce price volatility, we use deliverable contracts for corn (in which we take physical delivery of the corn underlying each contract) rather than futures contracts or options.

Interest Rates.

We employ [removed: over 4,800] [added: approximately 4,700] people on six [removed: continents,] [added: continents (excluding individuals that work on a part-time or temporary basis),] including approximately [removed: 1,300] [added: 1,200] people in Louisville, Kentucky, USA, home of our world headquarters.

[removed: Additionally, taking] [added: Taking] into account ownership of shares of our non-voting stock, the Brown family [added: also] controls more than 50% of the economic ownership in Brown-Forman.

Beginning in 1870 with Old Forester Kentucky Straight Bourbon Whisky – our founding brand – and spanning the generations since, we have built a portfolio of more than 40 spirit, ready-to-drink (RTD) cocktail, and wine brands that includes some of the best-known and [removed: most-loved] [added: most loved] trademarks in our industry.

[removed: The most important brand in our portfolio is] Jack Daniel’s Tennessee [removed: Whiskey, which] [added: Whiskey] is the [removed: fourth-largest spirits brand of any kind and the] largest American whiskey brand in the [removed: world,] [added: world and the fourth-largest spirits brand of any kind,] according to Impact Databank’s “Top 100 Premium Spirits Brands Worldwide” list.

Our other leading global brands on the Worldwide Impact list are Finlandia, which is the tenth-largest-selling vodka; [removed: Canadian Mist,] [added: Jack Daniel’s Tennessee Honey,] which is the [removed: fourth-largest-selling Canadian whisky;] [added: second-largest-selling flavored whiskey;] and el Jimador, which [removed: is] [added: grew to become] the [removed: fifth-largest-selling tequila and designated as an Impact “Hot Brand.” Additionally, Woodford Reserve was once again selected as an Impact “Hot Brand.”1][added: fourth-largest-selling tequila.]

| Jack Daniel’s [removed: Tennessee Honey] [added: RTDs2] | | el Jimador New Mix RTDs |

| Jack Daniel’s Single Barrel [removed: Collection2] [added: Collection3] | | GlenDronach Single Malt Scotch Whisky |

| Jack Daniel’s Tennessee [removed: Rye3] [added: Rye] | | BenRiach Single Malt Scotch Whisky |

| [removed: Woodford Reserve Kentucky Bourbon] [added: Jack Daniel’s Winter Jack] | | Old Forester Whiskey Row Series |

| Korbel California [removed: Brandy4] [added: Champagnes5] | | Coopers’ Craft Kentucky Bourbon |

| 1Impact Databank, March [removed: 2018.] [added: 2019.] | |

| [removed: 2The] [added: 3The] Jack Daniel’s Single Barrel Collection includes Jack Daniel’s Single Barrel Select, Jack Daniel’s Single Barrel Barrel Proof, Jack Daniel’s Single Barrel Rye, and Jack Daniel’s Single Barrel 100 Proof. | |

| [removed: 4While Korbel] [added: 5Korbel] is not an owned [removed: brand, we] [added: brand. We] sell Korbel products under contract in the United States and other select markets. | |

Management’s Discussion and Analysis of Financial Condition and Results of Operations – Results of Operations – Fiscal [removed: 2018] [added: 2019] Brand Highlights” for brand performance details.

Our vision in marketing is to be the best [removed: brand builders] [added: brand-builders] in the industry.

These programs cover a wide spectrum of activities, including media (TV, radio, print, outdoor, and, increasingly, digital and social), consumer and trade promotions, sponsorships, and [removed: homeplace] [added: visitors’ center] programs at our distilleries and our winery.

We expect to grow our sales and profits by consistently delivering creative, responsible marketing programs that drive brand recognition, brand trial, brand [removed: loyalty,] [added: loyalty –] and, ultimately, consumer demand around the world.

The United States, our most important market, accounted for 47% of our net sales in fiscal [removed: 2018.][added: 2019.]

Our largest international markets include the United Kingdom, [removed: Australia,] Mexico, [added: Australia,] Germany, France, Poland, Russia, [removed: Brazil,] [added: Japan,] and [removed: Canada.][added: Brazil.]

[removed: In fiscal 2018, we] [added: We] generated 53% of our net sales outside the United States [removed: compared to 56%] in fiscal [removed: 2014.][added: 2019.]

| [removed: 2014 | |] 2015 | | 2016 | | 2017 | | 2018 | | [added: 2019] | [added: | |]

| United States | [removed: 44] [added: 46] | % | [removed: 46] [added: 48] | % | 48 | % | [removed: 48] [added: 47] | % | 47 | % |

| Europe | [removed: 28 | % |] 27 | % | 27 | % | 26 | % | 27 | % | [added: 26 | % |]

| Australia | 6 | % | [removed: 6] [added: 5] | % | 5 | % | 5 | % | 5 | % |

| Other | [removed: 22 | % |] 21 | % | 20 | % | 21 | % | 21 | % | [added: 22 | % |]

| Total International | [removed: 56] [added: 54] | % | [removed: 54] [added: 52] | % | 52 | % | [removed: 52] [added: 53] | % | 53 | % |

Management’s Discussion and Analysis of Financial Condition and Results of Operations – Fiscal [removed: 2018] [added: 2019] Market Highlights.” For details about our reportable segment and for additional geographic information about net sales and long-lived assets, see Note [removed: 14] [added: 17] to the Consolidated Financial Statements in “Item 8.

Our distribution network, [removed: which we sometimes refer to as] [added: or] our “route-to-consumer” (RTC), [removed: takes a variety of forms,] [added: varies] depending on (a) a market’s laws and regulatory framework for trade in beverage alcohol, (b) our assessment of a market’s long-term attractiveness and competitive dynamics, (c) the relative profitability of distribution options available to us, (d) the structure of the retail and wholesale trade in a market, and (e) our portfolio’s development stage in a market.

We own and operate distribution companies in [removed: 14] [added: 11] markets: Australia, Brazil, Canada, [removed: China,] Czechia, France, Germany, [removed: Hong Kong,] Korea, Mexico, Poland, Spain, [removed: Thailand,] and Turkey.

In these markets, and in a large portion of the Travel Retail channel, we sell our products directly to [removed: retailers, to wholesalers, or, in Canada, to provincial governments.][added: retailers or wholesalers.]

Over the past decade, we began distribution operations in [removed: multiple] [added: several] markets outside the United States, [removed: as shown] [added: most recently] in [removed: the table below.][added: Spain during fiscal 2018.]

In many other markets, including Russia, Japan, Italy, and South Africa, we rely on [removed: others] [added: third parties] to distribute our brands, generally under fixed-term distribution contracts.

We believe [added: that] our [added: customer relationships are good and our] exposure to concentrations of credit risk is limited due to the diverse geographic areas covered by our operations.

Holiday buying makes the fourth calendar quarter [removed: (generally, our third fiscal quarter)] the peak season for our business.

Approximately [removed: 31%,] 30%, [added: 31%,] and 31% of our net sales for fiscal [removed: 2016, fiscal] 2017, [removed: and] fiscal 2018, [added: and fiscal 2019,] respectively, were in the fourth calendar quarter.

According to International Wine & Spirit Research (IWSR), for calendar year [removed: 2017,] [added: 2018,] the ten largest global spirits companies controlled less than 20% of the total global market for spirits (on a volume basis).

Several factors influence consumers’ buying decisions, [removed: including: advertising; promotions;] [added: including advertising, promotions,] merchandising [removed: in bars, restaurants, and shops;] [added: at the point of sale,] expert or celebrity [removed: endorsement;] [added: endorsement,] social media and word of [removed: mouth;] [added: mouth,] and the timing and relevance of new product introductions.

From time to time, our agricultural ingredients (agave, barley, corn, grapes, malted barley, [added: rye,] and [removed: rye)] [added: wood)] could be adversely affected by weather and other forces out of our control that might constrain [removed: supply.][added: supply or reduce our inventory below desired levels for optimum production.]

Because we must schedule production years in advance to meet [added: projected] future [removed: demand for these products,] [added: demand,] our inventories of [removed: them] [added: these products] may be larger in relation to sales and total assets than in many other businesses.

Our intellectual property [removed: rights include] [added: includes] trademarks, copyrights, proprietary packaging and trade dress, proprietary manufacturing technologies, know-how, and patents.

The most important brand in our portfolio is Jack Daniel’s Tennessee Whiskey, which was ranked in the 2018 Interbrand “Best Global Brands” as the most valuable global spirits brand in the world and the second most valuable beverage alcohol brand.

Woodford Reserve was once again selected as an Impact “Hot Brand,”1 marking six consecutive years on the list.

Old Forester and Pepe Lopez were also named to the 2018 “Hot Brand”1 list.

| Jack Daniel’s Tennessee Honey | | Herradura Tequilas6 |

| Jack Daniel’s Bottled-in-Bond4 | | Old Forester Kentucky Straight Rye Whisky4 |

| Woodford Reserve Kentucky Bourbon | | Chambord Liqueur |

| Woodford Reserve Kentucky Straight Malt Whiskey4 | | Antiguo Tequila |

| Finlandia Vodkas | | Slane Irish Whiskey |

| Korbel California Brandy5 | | |

| 2Jack Daniel’s RTDs includes Jack Daniel’s & Cola, Jack Daniel’s & Diet Cola, Jack & Ginger, Jack Daniel’s Country Cocktails, Gentleman Jack & Cola, Jack Daniel’s Double Jack, Jack Daniel’s American Serve, Jack Daniel’s Tennessee Honey RTD, Jack Daniel’s Cider, and Jack Daniel’s Lynchburg Lemonade. | |

| 4New brands launched in fiscal 2019. | |

| 6Herradura Tequilas comprises all expressions of Herradura including Herradura Ultra. | |

In Canada, we sell our products to provincial governments.

We realize that our people are integral to building our brands and growing our business, and to support this strategy we strive to build a strong, agile workforce emphasizing diversity and inclusion.

Portfolio

Woodford Reserve is the leading super-premium American whiskey globally1, and is poised for continued growth as interest in bourbon continues to increase around the world.

Following on the success of its high-end expressions, including the Old Forester Whiskey Row Series, we recently added Old Forester Rye to the brand line up.

We believe that super- and ultra-premium whiskeys are an attractive long-term business.

Similarly, Slane Irish Whiskey, which opened its distillery and visitors’ center in 2018 is poised to become a meaningful contributor for the Company in the fast-growing Irish whiskey category over time.

Geography

Achieving our long-term growth objectives requires us to deliver balanced geographic growth while increasing our competitiveness through improved routes to consumer.

| 1Impact Databank, March 2019. | |

Integrated Performance


Our view of Brown-Forman’s performance is multi-faceted, the “what” of our financial and business results are very much related to “how” we achieve them.

This view is shown in the quality of our culture, our people, our values, and our stakeholder relationships.

Our sense of corporate responsibility is informed by our commitment to ethics, diversity and inclusion, alcohol responsibility, environmental sustainability, and the community in which our employees live and work.

This integrated lens on performance, including Corporate Responsibility, recognizes that many aspects of our company contribute to value creation, our reputation and our success.

In 2017, we reviewed our corporate responsibility strategy against the SDGs to understand where our work aligns with these goals.

In 2018, we also became signatories to the United National Global Compact and submitted our first Communication on Progress.

Our values are

We also work closely with partners to extend our reach and impact.

In 2019, our Chambord Liqueur brand has partnered with Alteristic, a national organization of social accelerators dedicated to reducing power-based personal violence, to train bartenders on bystander intervention to help prevent sexual assault.

We also supported alcohol responsibility education of our employees through our recently launched Pause campaign, encouraging everyone to pause, consider, and make responsible decisions around alcohol consumption.

Diversity and Inclusion.

Community.

The Foundation distributed $2.5 million in charitable contributions in fiscal 2019.

We report our ongoing commitment and progress against all of these goals in our integrated Annual and Corporate Responsibility Report and on our website (www.brown-forman.com/responsibility).

| Kelli Nelson | 49 | Senior Vice President and Chief Accounting Officer since August 2018. Vice President and Director Finance (North America Region) from 2015 to August 2018. Director NAR Division Finance (North America Region) from 2013 to 2015. Director Business Planning and Analytics (North America Region) from 2012 to 2013. |

charge by writing to our Secretary, Matthew E.

In its fifth year on the Worldwide Impact list, Jack Daniel’s Tennessee Honey was recognized as a top 15 growth brand and remains the second-largest-selling flavored whiskey.

| --- | --- | --- |

| | | |

| Jack Daniel’s RTDs | | Herradura Tequilas |

| Jack Daniel’s Winter Jack | | Chambord Liqueur |

| Finlandia Vodkas | | Antiguo Tequila |

| Korbel California Champagnes4 | | Slane Irish Whiskey |

| 3New brand launched in September 2017. | |

The United States proportion of net sales grew from fiscal 2014 to fiscal 2016 then stayed constant in fiscal 2017, mainly due to the negative effect of foreign exchange on our international business.

| Recent Route-to-Consumer Changes | | |

| Fiscal year | | Market |

| 2011 | | Germany |

| | | Brazil |

| 2012 | | Turkey |

| 2014 | | France |

| 2018 | | Spain |

We believe that our customer relationships are good.

We register our trademarks broadly – some of them in every country where registration is possible.

We will focus first on the global growth of our most important expression, JDTW, though with a heightened focus on the super-premium expressions within the trademark – namely, Gentleman Jack, Jack Daniel’s Single Barrel Collection, and Jack Daniel’s Tennessee Rye.

We believe Woodford Reserve is the leading super-premium American whiskey globally.

In 2017, we unveiled our Slane Irish Whiskey brand in Ireland, select Travel Retail locations, and in select markets across the United States, the United Kingdom, and Australia.

The distillery and homeplace were completed this past year, and we are very encouraged by the brand’s early performance and the accolades the brand, whiskey, and package have received.

Here again, we are very encouraged by the trade and consumer reception to the brands and the whisky.

Fiscal 2018 saw a return to this trend after a few years of suppressed international growth driven by the negative effect of foreign exchange.

Our ability to achieve our long-term growth objectives requires further development of our business globally, especially in emerging markets.

Values-Driven Organization.

As a significant player in the global beverage alcohol industry, we foster collective action with our peers.

Working with other producers, we are able to leverage our views on a scale that can create change.

In 2017, we concluded our five-year program with 10 other industry leaders that signed the Beer, Wine, and Spirits Producers’ Commitments to Reduce Harmful Drinking.

Our collective progress on these commitments will be reported later in 2018 and can be seen at www.producerscommitments.org.

In the past year, we have added information from contributors on a variety of alcohol-related subjects, including addiction and pregnancy, moderate consumption, and alcohol and aggression.

In 2017, Korbel partnered with the Dryver designated driver service to provide more than 2,000 free designated drivers in 77 cities nationwide.

We also continued to collaborate with the Responsible Retailing Forum, which brings together diverse stakeholders seeking to reduce underage sales, among other initiatives.

Since then, we have added three additional markets and languages to the site, with plans to add four more in the coming year.

We also provide long-running support for alcohol education programs at the University of Louisville and the University of Kentucky (two major universities in the state of our corporate headquarters).

Our three anchor partners in Louisville, Kentucky, are The Healing Place, The Morton Center, and Volunteers of America Mid-States.

We report on our progress toward these goals in our biennial Corporate Responsibility Reports, available on our corporate website.

Diversity, Inclusion, and Human Rights.

Four

the eighth consecutive year.

| | For the fiscal year ended April 30, [removed: 2018] [added: 2019] |

| Title of each class | [added: Trading Symbol(s)] | Name of each exchange on which registered |

| Class A Common Stock (voting) $0.15 par value | [added: BFA] | New York Stock Exchange |

| Class B Common Stock (nonvoting) $0.15 par value | [added: BFB] | New York Stock Exchange |

| 1.200% Notes due 2026 | [added: BF26] | New York Stock Exchange |

| 2.600% Notes due 2028 | [added: BF28] | New York Stock Exchange |

Indicate by check mark whether the registrant has submitted electronically [removed: and posted on its corporate Web site, if any,] every Interactive Data File required to be submitted [removed: and posted] pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit [removed: and post] such files).

| Non-accelerated filer | ¨ | [removed: (Do not check if a smaller reporting company)] | Smaller reporting company | ¨ |

The aggregate market value, as of the last business day of the most recently completed second fiscal quarter, of the voting and nonvoting equity held by nonaffiliates of the registrant was approximately [removed: $14,900,000,000.][added: $16,000,000,000.]

The number of shares outstanding for each of the registrant’s classes of Common Stock on May 31, [removed: 2018,] [added: 2019,] was:

| Class A Common Stock (voting) | [removed: 169,048,402] [added: 168,985,878] | |

| Class B Common Stock (nonvoting) | [removed: 312,063,220] [added: 308,288,977] | |

Portions of the Proxy Statement of Registrant for use in connection with the Annual Meeting of Stockholders to be held July [removed: 26, 2018,] [added: 25, 2019,] are incorporated by reference into Part III of this report.

| Item 1. | [removed: [Business](#s4C9063FE9B5E5A63BB814294BE8B806B)] [added: [Business](#sCE8B497FEE1458AEB9F93DB04B89824A)] | [removed: [4](#s4C9063FE9B5E5A63BB814294BE8B806B)] [added: [4](#sCE8B497FEE1458AEB9F93DB04B89824A)] |

| Item 1A. | [Risk [removed: Factors](#sECF315B362905092857D5B89A5CE0698)] [added: Factors](#sB3FA959975D3504DA1C6A78BC13FFF70)] | [removed: [12](#sECF315B362905092857D5B89A5CE0698)] [added: [15](#sB3FA959975D3504DA1C6A78BC13FFF70)] |

| Item 1B. | [Unresolved Staff [removed: Comments](#s89D37225AE6F5543A7751E6715A2AF9A)] [added: Comments](#s4E32B3BBB1405E099686CC0123A39E9F)] | [removed: [20](#s89D37225AE6F5543A7751E6715A2AF9A)] [added: [23](#s4E32B3BBB1405E099686CC0123A39E9F)] |

| Item 2. | [removed: [Properties](#s594CEB04C4D15D19997E231891D37495)] [added: [Properties](#s1E3D475E477F5026B7543DACD679511A)] | [removed: [21](#s594CEB04C4D15D19997E231891D37495)] [added: [24](#s1E3D475E477F5026B7543DACD679511A)] |

| Item 3. | [Legal [removed: Proceedings](#s804B07C5E51E5C189466B5FCF6E10922)] [added: Proceedings](#sDE1E31D180A45C14ACD496C9EF9D9DBA)] | [removed: [22](#s804B07C5E51E5C189466B5FCF6E10922)] [added: [25](#sDE1E31D180A45C14ACD496C9EF9D9DBA)] |

| Item 4. | [Mine Safety [removed: Disclosures](#sE0E65CDED8375C24AEC6D6C43F1CE6DB)] [added: Disclosures](#s8E4254E773265EAC8D8D34CED8546C07)] | [removed: [22](#sE0E65CDED8375C24AEC6D6C43F1CE6DB)] [added: [25](#s8E4254E773265EAC8D8D34CED8546C07)] |

| Item 5. | [Market for the Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity [removed: Securities](#s8B7B1D4140135C95BADD7087EDA157EB)] [added: Securities](#sACD077A8DA0F5ADEA76DCE8212FF0544)] | [removed: [23](#s8B7B1D4140135C95BADD7087EDA157EB)] [added: [26](#sACD077A8DA0F5ADEA76DCE8212FF0544)] |

| Item 6. | [Selected Financial [removed: Data](#s78A69D5F78AF52549D3E50E34F07BE7C)] [added: Data](#s6C82890A1BB650398837FCA1D22E2FEF)] | [removed: [25](#s78A69D5F78AF52549D3E50E34F07BE7C)] [added: [29](#s6C82890A1BB650398837FCA1D22E2FEF)] |

| Item 7. | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#s5B49C995824C54A2A9A73F40316EFD9A)] [added: Operations](#sFB158F93D2E45D02A0DA726585412C4C)] | [removed: [26](#s5B49C995824C54A2A9A73F40316EFD9A)] [added: [30](#sFB158F93D2E45D02A0DA726585412C4C)] |

| Item 7A. | [Quantitative and Qualitative Disclosures about Market [removed: Risk](#sBF6F5A67B92A5054AA53F05E06344E0D)] [added: Risk](#sFDD2C57C89E35DD28AAA6135CCA277D8)] | [removed: [47](#sBF6F5A67B92A5054AA53F05E06344E0D)] [added: [52](#sFDD2C57C89E35DD28AAA6135CCA277D8)] |

| Item 8. | [Financial Statements and Supplementary [removed: Data](#s1E998AC9553B57BC98972D3C65227CE9)] [added: Data](#sF6E2EAE6D3C8516A9131289A71D6C358)] | [removed: [48](#s1E998AC9553B57BC98972D3C65227CE9)] [added: [54](#sF6E2EAE6D3C8516A9131289A71D6C358)] |

| Item 9. | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#s86A28EE8C9A05F35B38182BB87928E5A)] [added: Disclosure](#sDDC5962EE23C54FD94632BE4836233F4)] | [removed: [82](#s86A28EE8C9A05F35B38182BB87928E5A)] [added: [90](#sDDC5962EE23C54FD94632BE4836233F4)] |

| Item 9A. | [Controls and [removed: Procedures](#sA8C999CC33005F2799921F9C8A4B2CAE)] [added: Procedures](#s0EFA48E2C78751C4A57293564F480C88)] | [removed: [82](#sA8C999CC33005F2799921F9C8A4B2CAE)] [added: [90](#s0EFA48E2C78751C4A57293564F480C88)] |

| Item 9B. | [Other [removed: Information](#sF11360AFF0455E819D85968C69AE27EF)] [added: Information](#sFD415DCCA56C5291BA8193E855A04D37)] | [removed: [82](#sF11360AFF0455E819D85968C69AE27EF)] [added: [90](#sFD415DCCA56C5291BA8193E855A04D37)] |

| Item 10. | [Directors, Executive Officers, and Corporate [removed: Governance](#sB2E94F39765353A89A5DB485FBE7058F)] [added: Governance](#sF17DEBE2F8F6519BBA7986895B0E2C89)] | [removed: [82](#sB2E94F39765353A89A5DB485FBE7058F)] [added: [90](#sF17DEBE2F8F6519BBA7986895B0E2C89)] |

| Item 11. | [Executive [removed: Compensation](#s4792FFDD3DE956DF9780115569BC1687)] [added: Compensation](#s12141C53EACA582ABAB6B20C78E4C629)] | [removed: [82](#s4792FFDD3DE956DF9780115569BC1687)] [added: [90](#s12141C53EACA582ABAB6B20C78E4C629)] |

| Item 12. | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#s66D2BD693F1C5B0B9F5FDC9EEFC732B4)] [added: Matters](#sCA3880A1856354E990BD8114EC137140)] | [removed: [82](#s66D2BD693F1C5B0B9F5FDC9EEFC732B4)] [added: [90](#sCA3880A1856354E990BD8114EC137140)] |

| Item 13. | [Certain Relationships and Related Transactions, and Director [removed: Independence](#s35478A25BF5A5C35BA7A55C1DBC86B91)] [added: Independence](#sC666E9C685EB5C99A6E76C0A9373E4D0)] | [removed: [82](#s35478A25BF5A5C35BA7A55C1DBC86B91)] [added: [90](#sC666E9C685EB5C99A6E76C0A9373E4D0)] |

| Item 14. | [Principal Accounting Fees and [removed: Services](#sB470FBB5A1C8549FB51447372C84E6F0)] [added: Services](#s8238F2619D3455ABAEB8042F4850E3E4)] | [removed: [83](#sB470FBB5A1C8549FB51447372C84E6F0)] [added: [91](#s8238F2619D3455ABAEB8042F4850E3E4)] |

| Item 15. | [Exhibits and Financial Statements [removed: Schedules](#s26CF90F193705C2BAA1D557454743433)] [added: Schedules](#s277BB4D4ED9F5D369076527061D1C178)] | [removed: [83](#s26CF90F193705C2BAA1D557454743433)] [added: [91](#s277BB4D4ED9F5D369076527061D1C178)] |

| Item 16. | [Form 10-K [removed: Summary](#s64CE93BE8C2850BB9D9C3C19AA6F800A)] [added: Summary](#s0F37CCE22F4554BF806C9F54F7EB3462)] | [removed: [86](#s64CE93BE8C2850BB9D9C3C19AA6F800A)] [added: [93](#s0F37CCE22F4554BF806C9F54F7EB3462)] |

| [SCHEDULE II – Valuation and Qualifying [removed: Accounts](#sCF01EE385292577087373E85B1353A00)] [added: Accounts](#s2BA924378D085778999CC31F25041978)] | | [removed: [89](#sCF01EE385292577087373E85B1353A00)] [added: [97](#s2BA924378D085778999CC31F25041978)] |

| • | Risks associated with being a U.S.-based company with global operations, including commercial, political, and financial risks; local labor policies and conditions; protectionist trade policies, or economic or trade sanctions, including [removed: potential] [added: additional] retaliatory tariffs on American [removed: spirits;] [added: spirits and the effectiveness of our actions to mitigate the negative impact on our margins, sales, and distributors;] compliance with local trade practices and other regulations, including anti-corruption laws; terrorism; and health pandemics |

| • | The impact of [removed: the recently enacted] U.S. tax reform legislation, including as a result of future [removed: regulations] [added: clarifications] and guidance interpreting the statute |

| • | Product recalls or other product liability claims, [removed: or] product counterfeiting, tampering, contamination, or quality issues |

| • | Our status as a family “controlled company” under New York Stock Exchange rules, and our [removed: dual class] [added: dual-class] share structure |

and Analysis of Financial Condition and Results of Operations,” we present the reasons we use these measures under the [removed: heading,] [added: heading] “Non-GAAP Financial Measures,” and we reconcile these measures to the most closely comparable GAAP measures under the heading “Results of Operations – Year-Over-Year Comparisons.”

10-K 1 bfb-2019430x10kapril.htm 10-K

| [SIGNATURES](#sEB4DAAAD9D6250DEB21C119FB1F5A380) | | [93](#sEB4DAAAD9D6250DEB21C119FB1F5A380) |

10-K 1 bfb-2018430x10kapril.htm 10-K

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

| [SIGNATURES](#sB834A36D501555E793B5CFAE7FB2AC50) | | [86](#sB834A36D501555E793B5CFAE7FB2AC50) |

Our company-owned production facilities include distilleries, a winery, [removed: a concentrate plant,] bottling plants, warehousing operations, sawmills, and cooperages.

We also have agreements with other parties for contract production in Australia, Belgium, Brazil, China, Estonia, Finland, Ireland, [added: Latvia,] Mexico, the Netherlands, South Africa, and the United States.

| • | International: Guadalajara, Mexico; Hamburg, Germany; [added: São Paulo, Brazil;] Moscow, Russia; Warsaw, Poland; Sydney, Australia; [removed: São Paulo, Brazil;] Paris, France; Prague, Czechia; Amsterdam, Netherlands; London, United Kingdom; Barcelona, Spain; Mexico City, Mexico; Seoul, South Korea; Gurgaon, India; Istanbul, Turkey; Shanghai, China; Hong Kong; Cape Town, South Africa; Dubai, United Arab Emirates; Kiev, Ukraine; and Tokyo, Japan. |

| [removed: Decatur,] [added: Trinity,] Alabama | Cooperage | Jack Daniel Cooperage |

| Amatitán, Mexico | Distilling, bottling, warehousing | Home of our [removed: tequilas and New Mix RTDs] [added: tequila brands] |

As of May 31, [removed: 2018,] [added: 2019,] there were [removed: 2,639] [added: 2,575] holders of record of Class A common stock and [removed: 5,486] [added: 5,271] holders of record of Class B common stock.

Because of overlapping ownership between classes, as of May 31, [removed: 2018,] [added: 2019,] we had only [removed: 5,431] [added: 5,327] distinct common stockholders of record.

The following table summarizes information as of April 30, [removed: 2018,] [added: 2019,] about our equity compensation plans under which we have made grants of stock options, stock appreciation rights, restricted stock, market value units, performance units, or other equity awards.

| Equity compensation plans approved by Class A common stockholders | | | [removed: 3,365,537] [added: 3,141,260] | | [removed: $29.67] [added: $33.25] | | [removed: 14,790,843] [added: 14,141,324] |

1Includes [removed: 2,971,180] [added: 2,583,815] Class B common shares to be issued upon exercise of stock-settled stock appreciation rights (SSARs); [removed: 199,973] [added: 175,440] Class B [removed: common] [added: performance-based] restricted stock [removed: units (RSUs); 114,703] [added: units; 165,579] Class A [added: performance-based restricted stock units; 138,331 Class A] common deferred stock units (DSUs); and [removed: 79,681] [added: 78,095] Class B common DSUs issued under the Brown-Forman 2004 or 2013 Omnibus Compensation Plans.

The fair market value of our common stock at fiscal year-end has been used for the purposes of reporting the number of shares to be issued upon exercise of the [removed: 7,215,010] [added: 6,851,991] SSARs outstanding at fiscal year-end.

The graph below compares the cumulative total shareholder return of our Class B common stock for the last five [added: fiscal] years with the Standard & Poor’s 500 Index, the Dow Jones U.S. Consumer Goods Index, and the Dow Jones U.S. Food & Beverage Index.

The information presented assumes an initial investment of $100 on April 30, [removed: 2013,] [added: 2014,] and that all dividends were reinvested.

The [removed: cumulative returns shown represent] [added: graph shows] the value that each of these investments would have had on April 30 in the years since [removed: 2013.][added: 2014.]

[removed: ][added: ]

Share Repurchases

The following table provides information about shares of our common stock (Class A and Class B, in total) that we acquired during the quarter ended April 30, 2019:

| | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | |

| Period | Total Number of Shares Purchased | | Average Price Paid per Share | | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | | Approximate Dollar Value of Shares that May Yet Be Purchased under the Plans or Programs | | |

| February 1, 2019 – February 28, 2019 | 14,204 | | $ | 47.07 | | — | | $ | — | |

| March 1, 2019 – March 31, 2019 | — | | $ | — | | — | | $ | — | |

| April 1, 2019 – April 30, 2019 | 1,490 | | $ | 51.86 | | — | | $ | — | |

| Total | 15,694 | | $ | 47.53 | | — | | | | |

The shares presented in the above table were acquired from employees to satisfy income tax withholdings triggered by the vesting of restricted shares.

The following table presents, for the periods indicated, the high and low sales prices per share for our Class A and Class B common stock, as reported on the New York Stock Exchange composite index, and dividend per share information:

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | Fiscal 2017 | | | | | | | | | | | | | | | | | | | | Fiscal 2018 | | | | | | | | | | | | | | | | | | |

| | | First Quarter | | | | Second Quarter | | | | Third Quarter | | | | Fourth Quarter | | | | Year | | | | First Quarter | | | | Second Quarter | | | | Third Quarter | | | | Fourth Quarter | | | | Year | | |

| Market price per share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Class A high | | $ | 43.42 | | | $ | 43.56 | | | $ | 39.46 | | | $ | 40.04 | | | $ | 43.56 | | | $ | 42.75 | | | $ | 42.62 | | | $ | 51.30 | | | $ | 55.67 | | | $ | 55.67 | |

| Class A low | | 40.62 | | | | 37.60 | | | | 36.50 | | | | 37.09 | | | | 36.50 | | | | 35.50 | | | | 37.79 | | | | 41.14 | | | | 46.61 | | | | 35.50 | | |

| Class B high | | 40.32 | | | | 40.85 | | | | 37.63 | | | | 39.16 | | | | 40.85 | | | | 45.54 | | | | 45.62 | | | | 55.66 | | | | 56.52 | | | | 56.52 | | |

| Class B low | | 37.56 | | | | 35.73 | | | | 35.17 | | | | 36.01 | | | | 35.17 | | | | 37.82 | | | | 38.43 | | | | 44.08 | | | | 50.66 | | | | 37.82 | | |

| Cash dividends per share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Declared | | 0.272 | | | | — | | | | 0.292 | | | | — | | | | 0.564 | | | | 0.292 | | | | — | | | | 1.316 | | | | — | | | | 1.608 | | |

| Paid | | 0.136 | | | | 0.136 | | | | 0.146 | | | | 0.146 | | | | 0.564 | | | | 0.146 | | | | 0.146 | | | | 0.158 | | | | 1.158 | | | | 1.608 | | |

Notes:

1.

Amounts have been adjusted for a 5-for-4 stock split that occurred in February 2018.

2.

Cash dividends for fiscal 2018 include a special dividend of $1.00 per share.

Does not include issued shares of performance-based restricted stock.

| | [removed: 2014 | | |] 2015 | | | 2016 | | | 2017 | | | 2018 | | | [added: 2019 | | |]

| Net sales | $ | [removed: 2,991 | | $ |] 3,134 | | $ | 3,089 | | $ | 2,994 | | $ | 3,248 | | [added: $ | 3,324 | |]

| Gross profit | $ | [removed: 2,078 | | $ |] 2,183 | | $ | 2,144 | | $ | 2,021 | | $ | 2,202 | | [added: $ | 2,166 | |]

| Net income | $ | [removed: 659 | | $ |] 684 | | $ | 1,067 | | $ | 669 | | $ | 717 | | [added: $ | 835 | |]

| – Basic | [removed: 533.6 | | |] 529.0 | | | 507.4 | | | 484.6 | | | 480.3 | | | [added: 479.0 | | |]

| – Diluted | [removed: 537.7 | | |] 532.7 | | | 510.7 | | | 488.1 | | | 484.2 | | | [added: 482.1 | | |]

| – Basic | $ | [removed: 1.23 | | $ |] 1.29 | | $ | 2.10 | | $ | 1.38 | | $ | 1.49 | | [added: $ | 1.74 | |]

| – Diluted | $ | [removed: 1.22 | | $ |] 1.28 | | $ | 2.09 | | $ | 1.37 | | $ | 1.48 | | [added: $ | 1.73 | |]

| Gross margin | [removed: 69.5 | | % |] 69.7 | | % | 69.4 | | % | 67.5 | | % | 67.8 | | % | [added: 65.2 | | % |]

| Effective tax rate | [removed: 30.5] [added: 31.7] | | % | [removed: 31.7] [added: 28.3] | | % | 28.3 | | % | [removed: 28.3] [added: 26.6] | | % | [removed: 26.6] [added: 19.8] | | % |

| Average invested capital | $ | [removed: 3,131 | | $ |] 3,196 | | $ | 3,221 | | $ | 3,591 | | $ | 3,832 | | [added: $ | 4,125 | |]

| Return on average invested capital | [removed: 21.6 | | % |] 22.0 | | % | 34.1 | | % | 19.8 | | % | 20.0 | | % | [added: 22.0 | | % |]

| Cash dividends declared per common share | $ | [removed: 0.436 | | $ |] 0.484 | | $ | 0.524 | | $ | 0.564 | | $ | 1.608 | | [added: $ | 0.648 | |]

| Dividend payout ratio | [removed: 35.3 | | % |] 37.5 | | % | 25.0 | | % | 40.9 | | % | 107.8 | | % | [added: 37.2 | | % |]

| Total assets | $ | [removed: 4,103 | | $ |] 4,188 | | $ | 4,183 | | $ | 4,625 | | $ | 4,976 | | [added: $ | 5,139 | |]

| Long-term debt | $ | [removed: 997 | | $ |] 743 | | $ | 1,230 | | $ | 1,689 | | $ | 2,341 | | [added: $ | 2,290 | |]

| Total debt | $ | [removed: 1,005 | | $ |] 1,183 | | $ | 1,501 | | $ | 2,149 | | $ | 2,556 | | [added: $ | 2,440 | |]

| [removed: 3.] [added: 4.] | See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation – Non-GAAP Financial Measures” for details on our use of “return on average invested capital,” including how we calculate this measure and why we think this information is useful to readers. |

| [removed: 4.] [added: 5.] | Cash dividends declared per common share include a special cash dividend of $1.00 in fiscal 2018. |

| [removed: 5.] [added: 6] | We define dividend payout ratio as cash dividends divided by net income. |

| Sales | $ | 4,096 | | $ | 4,011 | | $ | 3,857 | | $ | 4,201 | | $ | 4,276 | |

| Excise taxes | $ | 962 | | $ | 922 | | $ | 863 | | $ | 953 | | $ | 952 | |

| Operating income | $ | 1,045 | | $ | 1,556 | | $ | 1,010 | | $ | 1,048 | | $ | 1,144 | |

| Operating margin | 33.3 | | % | 50.4 | | % | 33.8 | | % | 32.3 | | % | 34.4 | | % |

| Cash provided by operations | $ | 631 | | $ | 545 | | $ | 656 | | $ | 653 | | $ | 800 | |

| 3. | As discussed in Note 2 to the Consolidated Financial Statements, we adopted Accounting Standards Updates (ASUs) 2016-15 and 2017-07 as of May 1, 2018. The amounts presented above for operating income, operating margin, and cash provided by operations differ from previously reported amounts due to the retrospective application of those ASUs. |

| Operating income | $ | 971 | | $ | 1,027 | | $ | 1,533 | | $ | 989 | | $ | 1,039 | |

| Operating margin | 32.5 | | % | 32.8 | | % | 49.6 | | % | 33.0 | | % | 32.0 | | % |

| Cash flow from operations | $ | 649 | | $ | 608 | | $ | 524 | | $ | 639 | | $ | 632 | |

| [Reports of [removed: Management](#s27AA0FEBFA8753208228DF110A203F98)] [added: Management](#s0BC37A3B4C9459FAAE39B309A5A22873)] | [removed: [49](#s27AA0FEBFA8753208228DF110A203F98)] [added: [55](#s0BC37A3B4C9459FAAE39B309A5A22873)] |

| [Report of Independent Registered Public Accounting [removed: Firm](#s9DF2C948674C57B3ACDB3C10318119F1)] [added: Firm](#sC1826A85D327545B97DDE4DD69032FB2)] | [removed: [50](#s9DF2C948674C57B3ACDB3C10318119F1)] [added: [56](#sC1826A85D327545B97DDE4DD69032FB2)] |

| [Consolidated Statements of [removed: Operations](#s45717C2FDB8A52F9912009621B898551)] [added: Operations](#s35AE0F70CA905462B016D8384CD5B27D)] | [removed: [52](#s45717C2FDB8A52F9912009621B898551)] [added: [58](#s35AE0F70CA905462B016D8384CD5B27D)] |

| [Consolidated Statements of Comprehensive [removed: Income](#s048705BAA865557AAD2F7DA791A97F02)] [added: Income](#s4A004D0D697E548C8AC21F27C8174D26)] | [removed: [53](#s048705BAA865557AAD2F7DA791A97F02)] [added: [59](#s4A004D0D697E548C8AC21F27C8174D26)] |

| [Consolidated Balance [removed: Sheets](#sCAF87665B81B5D59BE42873F354E5E52)] [added: Sheets](#s207183E6C7425CC795A96F4F19A2F7A6)] | [removed: [54](#sCAF87665B81B5D59BE42873F354E5E52)] [added: [60](#s207183E6C7425CC795A96F4F19A2F7A6)] |

| [Consolidated Statements of Cash [removed: Flows](#s1BB35713784A569A881BB8062BEE62EB)] [added: Flows](#s6946B21E7B3C529E82BFB74F10156E7E)] | [removed: [55](#s1BB35713784A569A881BB8062BEE62EB)] [added: [61](#s6946B21E7B3C529E82BFB74F10156E7E)] |

| [Consolidated Statements of Stockholders’ [removed: Equity](#sB22EBE79B2F55EE280FB1178B24D44C9)] [added: Equity](#s9CFC16D37DC6533CB2C3812A4ABBADBD)] | [removed: [56](#sE887311F57CF5D0796C1F73D52DB6036)] [added: [62](#s3182A788D4DE5BD0BC1346E79C2DE1FC)] |

| [Notes to Consolidated Financial [removed: Statements](#sD29B2F422C6E533F9BDBDC86CE87CAA3)] [added: Statements](#sC34BB91AF330588A9CE261E8DEDE7C71)] | [removed: [57](#sD29B2F422C6E533F9BDBDC86CE87CAA3)] [added: [63](#sC34BB91AF330588A9CE261E8DEDE7C71)] |

| [Quarterly Financial Information [removed: (Unaudited)](#sCBE8EDF5A87E54C683CFCEA55AD4754E)] [added: (Unaudited)](#sB68F390D321E5B0983B2D77DCCD13055)] | [removed: [81](#sCBE8EDF5A87E54C683CFCEA55AD4754E)] [added: [89](#sB68F390D321E5B0983B2D77DCCD13055)] |

Our management is responsible for [removed: the preparation, presentation,] [added: preparing, presenting,] and [added: ensuring the] integrity of the financial information presented in this report.

The Audit Committee of the Board of Directors, comprising only independent directors, meets regularly with our external auditors, the independent registered public accounting firm PricewaterhouseCoopers LLP [removed: (PwC),] [added: (PwC);] with our internal [removed: auditors,] [added: auditors;] and with representatives of management to review accounting, internal control structure, and financial reporting matters.

Management is also responsible for establishing and maintaining effective internal control over financial reporting, as defined in [removed: Rule] [added: Rules] 13a-15(f) [added: and 15d-15(f)] under the Securities Exchange Act of [removed: 1934.][added: 1934, as amended.]

Based on this assessment, management concluded that our internal control over financial reporting was effective as of April 30, [removed: 2018.][added: 2019.]

[removed: PwC] [added: PwC, which audited and reported on the Company’s consolidated financial statements,] has audited the effectiveness of our internal control over financial reporting as of April 30, [removed: 2018,] [added: 2019,] as stated in their report.

| Dated: | June 13, [removed: 2018] [added: 2019] | | |

| | | | [added: President and] Chief Executive Officer [removed: and Chairman of the Company] |

We have audited the accompanying consolidated balance sheets of Brown-Forman Corporation and its subsidiaries [added: (the “Company”)] as of April 30, [removed: 2018] [added: 2019] and [removed: 2017,] [added: 2018,] and the related consolidated statements of operations, comprehensive income, stockholders’ equity and cash flows for each of the three years in the period ended April 30, [removed: 2018,] [added: 2019,] including the related notes and schedule of valuation and qualifying accounts for each of the three years in the period ended April 30, [removed: 2018] [added: 2019] appearing under Item 15(a)(2) (collectively referred to as the “consolidated financial statements”).

We also have audited the Company’s internal control over financial reporting as of April 30, [removed: 2018,] [added: 2019,] based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of April 30, [removed: 2018] [added: 2019] and [removed: 2017,] [added: 2018,] and the results of their operations and their cash flows for each of the three years in the period ended April 30, [removed: 2018] [added: 2019] in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of April 30, [removed: 2018,] [added: 2019,] based on criteria established in Internal Control – Integrated Framework (2013) issued by the COSO.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) [removed: (“PCAOB”)] [added: (PCAOB)] and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

[removed: BROWN-FORMAN CORPORATION][added: Brown-Forman Corporation and Subsidiaries]

| Year Ended April 30, | [removed: 2016] [added: 2017] | | | | [removed: 2017] [added: 2018] | | | | [removed: 2018] [added: 2019] | | |

| Sales | $ | [removed: 4,011] [added: 3,857] | | | $ | [removed: 3,857] [added: 4,201] | | | $ | [removed: 4,201] [added: 4,276] | |

| Excise taxes | [removed: 922] [added: 863] | | | | [removed: 863] [added: 953] | | | | [removed: 953] [added: 952] | | |

| Net sales | [removed: 3,089] [added: 2,994] | | | | [removed: 2,994] [added: 3,248] | | | | [removed: 3,248] [added: 3,324] | | |

| Cost of sales | [removed: 945] [added: 973] | | | | [removed: 973] [added: 1,046] | | | | [removed: 1,046] [added: 1,158] | | |

| Gross profit | [removed: 2,144] [added: 2,021] | | | | [removed: 2,021] [added: 2,202] | | | | [removed: 2,202] [added: 2,166] | | |

| Selling, general, and administrative expenses | [removed: 688] [added: 657] | | | | [removed: 667] [added: 765] | | | | [removed: 765] [added: 641] | | |

| Other expense (income), net | [removed: (9] [added: (18] | | ) | | [removed: (18] [added: (16] | | ) | | [removed: (16] [added: (15] | | ) |

| Interest income | [removed: 2] [added: (3] | | [added: )] | | [removed: 3] [added: (6] | | [added: )] | | [removed: 6] [added: (8] | | [added: )] |

| Interest expense | [removed: 46] [added: 59] | | | | [removed: 59] [added: 68] | | | | [removed: 68] [added: 88] | | |

| Income before income taxes | [removed: 1,489] [added: 933] | | | | [removed: 933] [added: 977] | | | | [removed: 977] [added: 1,042] | | |

| Income taxes | [removed: 422] [added: 264] | | | | [removed: 264] [added: 260] | | | | [removed: 260] [added: 207] | | |

| Net income | $ | [removed: 1,067] [added: 669] | | | $ | [removed: 669] [added: 717] | | | $ | [removed: 717] [added: 835] | |

| Basic | $ | [removed: 2.10] [added: 1.38] | | | $ | [removed: 1.38] [added: 1.49] | | | $ | [removed: 1.49] [added: 1.74] | |

| Diluted | $ | [removed: 2.09] [added: 1.37] | | | $ | [removed: 1.37] [added: 1.48] | | | $ | [removed: 1.48] [added: 1.73] | |

| Currency translation adjustments | [removed: (23] [added: (73] | | ) | | [removed: (73] [added: 24] | | [removed: )] | | [removed: 24] [added: (27] | | [added: )] |

| Cash flow hedge adjustments | [removed: (17] [added: —] | | [removed: )] | | [removed: —] [added: (28] | | [added: )] | | [removed: (28] [added: 48] | | [removed: )] |

| Postretirement benefits adjustments | [removed: (10] [added: 33] | | [removed: )] | | [removed: 33] [added: 16] | | | | [removed: 16] [added: (6] | | [added: )] |

| | | By: | /s/ Lawson E. Whiting |

| | | | Lawson E. Whiting |

| Advertising expenses | 372 | | | | 405 | | | | 396 | | |

| Operating income | 1,010 | | | | 1,048 | | | | 1,144 | | |

| Non-operating postretirement expense | 21 | | | | 9 | | | | 22 | | |

Brown-Forman Corporation and Subsidiaries

| Net income | $ | 669 | | | $ | 717 | | | $ | 835 | |

Brown-Forman Corporation and Subsidiaries

Brown-Forman Corporation and Subsidiaries

| Net income | $ | 669 | | | $ | 717 | | | $ | 835 | |

| Deferred income tax provision (benefit) | (10 | | ) | | (69 | | ) | | 38 | | |

| U.S. Tax Act repatriation tax provision (benefit) | — | | | | 91 | | | | (4 | | ) |

| Payments for corporate-owned life insurance | (17 | | ) | | (21 | | ) | | (2 | | ) |

| Proceeds from corporate-owned life insurance | — | | | | — | | | | 4 | | |

Brown-Forman Corporation and Subsidiaries

| Cumulative effect of change in accounting principle (Note 2) | | | | | | | | | | | | | (5 | | ) | | | | | | | | | | (5 | | ) |

| Balance at April 30, 2019 | $ | 25 | | | $ | 47 | | | $ | — | | | $ | 2,238 | | | $ | (363 | ) | | $ | (300 | ) | | $ | 1,647 | |

Brown-Forman Corporation and Subsidiaries

Goodwill is impaired when the carrying amount of the related reporting unit exceeds its estimated fair value, in which case we write down the goodwill by the amount of the excess (limited to the carrying amount of the goodwill).

Similarly, a brand name is impaired when its carrying amount exceeds its estimated fair value, in which case we write down the brand name to its estimated fair value.

We also consider market values

Our net sales predominantly reflect global sales of beverage alcohol consumer products.

We sell these products under contracts with different types of customers, depending on the market.

The customer is most often a distributor, wholesaler, or retailer.

Each contract typically includes a single performance obligation to transfer control of the products to the customer.

Depending on the contract, control is transferred when the products are either shipped or delivered to the customer, at which point we recognize the transaction price for those products as net sales.

The transaction price recognized at that point reflects our estimate of the consideration to be received in exchange for the products.

The actual amount may ultimately differ due to the effect of various customer incentives and trade promotion activities.

In making our estimates, we consider our historical experience and current expectations, as applicable.

Subsequent adjustments recognized for changes in estimated transaction prices are typically not material.

Net sales exclude taxes we collect from customers that are imposed by various governments on our sales, and are reduced by payments to customers unless made in exchange for distinct goods or services with fair values approximating the payments.

We recognize the cost of those activities in cost of sales during the same period in which we recognize the related net sales.

Sales returns, which are permitted only in limited situations, are not material.

Customer payment terms generally range from 30 to 90 days.

There are no significant amounts of contract assets or liabilities.

Stock-based compensation.

We use stock-based awards as part of our incentive compensation for eligible employees and directors.

We recognize the grant-date fair value of an award as compensation expense on a straight-line basis over the requisite service period, which typically corresponds to the vesting period for the award.

Upon forfeiture of an award prior to vesting, we reverse any previously-recognized compensation expense related to that award.

We classify stock-based compensation expense within selling, general, and administrative expenses.

| | |

| --- | --- |

| | | By: | /s/ Paul C. Varga |

| | | | Paul C. Varga |

June 13, 2018

| Advertising expenses | 417 | | | | 383 | | | | 414 | | |

| Gain on sale of business | (485 | | ) | | — | | | | — | | |

| Operating income | 1,533 | | | | 989 | | | | 1,039 | | |

| Current portion of long-term debt | 249 | | | | — | | |

| Proceeds from sale of business | 543 | | | | — | | | | — | | |

| Balance at April 30, 2015 | $ | 13 | | | $ | 21 | | | $ | 99 | | | $ | 3,300 | | | $ | (300 | ) | | $ | (1,228 | ) | | $ | 1,905 | |

If an asset’s fair value is less than its book value, we write it down to its estimated fair value.

For goodwill, if the book value of the reporting unit exceeds its estimated fair value, we measure for potential impairment by comparing the implied fair value of the reporting unit’s goodwill, determined in the same manner as in a business combination, to the goodwill’s book value.

We recognize sales when title and risk of loss pass to the customer, typically when the product is shipped.

We record sales net of estimated sales returns, allowances, and discounts.

Net sales are further reduced by excise taxes that we collect from our customers and remit to governmental authorities.

Shipping and handling fees and costs.

Recently adopted accounting pronouncements.

| • | ASU 2015-07: Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share. This new standard amends the previous disclosure guidance related to investments measured at net asset value. Under the new standard, investments measured at net asset value as a practical expedient are no longer categorized in the fair value hierarchy. |

New accounting pronouncements to be adopted.

We have substantially completed our comprehensive assessment of the impact of the new guidance, and have concluded that adoption will not have a material impact on our financial statements.

However, under the new standard, we will estimate and recognize the cost of certain customer incentives earlier than previously recognized.

Although we expect this change in timing to shift the recognition of these costs among fiscal quarters, we do not expect the full-year impact to be significant.

We anticipate the impact of this change in classification to be insignificant as well.

We will adopt the new standard using the modified retrospective method by recognizing the cumulative effect of applying the new standard as an adjustment to retained earnings as of May 1, 2018.

We anticipate the adjustment, reflecting the accelerated recognition of the cost of certain customer incentives, to decrease retained earnings by approximately $30 (net of tax).

We are in the process of finalizing the calculation of the adjustment, which will be completed during the first quarter of fiscal 2019.

| • | ASU 2017-04: Simplifying the Test for Goodwill Impairment. This updated guidance eliminates the second step of the existing two-step quantitative test of goodwill for impairment. Under the new guidance, the quantitative test will consist of a single step in which the carrying amount of the reporting unit will be compared to its fair value. An impairment charge would be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the amount of the impairment would be limited to the total amount of goodwill allocated to the reporting unit. The guidance does not affect the existing option to perform the qualitative assessment for a reporting unit to determine whether the quantitative impairment test is necessary. We do not expect adoption of the new standard, which is to be applied prospectively, to have an impact on our consolidated financial statements. |

In addition, the FASB has issued the ASUs described below that we are not required to adopt until May 1, 2019 (although early adoption is permitted).

We are currently evaluating their potential impact on our financial statements.

| • | ASU 2017-12: Targeted Improvements to Accounting for Hedging Activities. This new guidance is intended to better align hedge accounting with an entity’s risk management activities and improve disclosures about hedges. The guidance expands hedge accounting for financial and nonfinancial risk components, eliminates the requirement to separately measure and report hedge ineffectiveness, simplifies the way assessments of hedge effectiveness may be performed, and amends some presentation and disclosure requirements for hedges. It is to be applied using a modified retrospective transition approach for cash flow and net investment hedges existing at the date of adoption. The amended presentation and disclosure guidance is required only prospectively. We have not yet determined our plans for adoption, but are considering the possibility of adopting this new guidance before the required adoption date. |

| | $ | 342 | | | $ | 298 | |

| | 1,333 | | | | 1,436 | | |

| | $ | 713 | | | $ | 780 | |

| | 364 | | | | 427 | | |

| | $ | 501 | | | $ | 581 | |

| Balance as of April 30, 2016 | $ | 590 | | | $ | 595 | |

| Acquisition of business (Note 16) | 183 | | | | 65 | | |

| 2.25% senior notes, $250 principal amount, due January 15, 2023 | 248 | | | | 248 | | |

| | 1,938 | | | | 2,341 | | |

Our management, with the participation of our Chief Executive Officer (CEO) and Chief Financial Officer (CFO) (our principal executive and principal financial officers), has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of [removed: 1934] [added: 1934, as amended] (the “Exchange Act”)) as of the end of fiscal [removed: 2018.][added: 2019.]

There has been no change in our internal control over financial reporting during the quarter ended April 30, [removed: 2018,] [added: 2019,] that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Management’s report on our internal control over financial reporting as of April 30, [removed: 2018,] [added: 2019,] and our independent registered public accounting firm’s report on our internal control over financial reporting are set forth in “Item 8.

For the other information required by this item, see the following sections of our definitive proxy statement for the Annual Meeting of Stockholders to be held July [removed: 26, 2018,] [added: 25, 2019,] which information is incorporated into this report by reference: (a) “Election of Directors” (for biographical information on directors and family relationships); (b) “Code of Conduct” (for information on our Code of Ethics); (c) [removed: “Section] [added: “Delinquent Section] 16(a) [removed: Beneficial Ownership Reporting Compliance”] [added: Reports”] (for information on compliance with Section 16 of the Exchange Act); (d) “Selection of Directors” (for information on the procedures by which security holders may recommend nominees to the Company’s Board of Directors); and (e) “Corporate Governance” (for information on our Audit Committee).

For the information required by this item, refer to the following sections of our definitive proxy statement for the Annual Meeting of Stockholders to be held July [removed: 26, 2018,] [added: 25, 2019,] which information is incorporated into this report by reference: (a) “Compensation Discussion and Analysis”; (b) “Compensation Tables”; (c) “Director Compensation”; (d) “Compensation Committee Interlocks and Insider Participation”; (e) “Compensation Committee Report”; and (f) “Pay Ratio Disclosure.”

Market for the Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities.” For the other information required by this item, refer to the section entitled “Stock Ownership” of our definitive proxy statement for the Annual Meeting of Stockholders to be held July [removed: 26, 2018,] [added: 25, 2019,] which information is incorporated into this report by reference.

For the information required by this item, refer to the following sections of our definitive proxy statement for the Annual Meeting of Stockholders to be held July [removed: 26, 2018,] [added: 25, 2019,] which information is incorporated into this report by reference: (a) “Certain Relationships and Related Transactions”; and (b) “Our Independent Directors.”

For the information required by this item, refer to the following sections of our definitive proxy statement for the Annual Meeting of Stockholders to be held July [removed: 26, 2018,] [added: 25, 2019,] which information is incorporated into this report by reference: (a) “Fees Paid to Independent Registered Public Accounting Firm”; and (b) “Audit Committee Pre-Approval Policies and Procedures.”

| | [Report of Independent Registered Public Accounting [removed: Firm](#s9DF2C948674C57B3ACDB3C10318119F1)] [added: Firm](#sC1826A85D327545B97DDE4DD69032FB2)] | [removed: [50](#s9DF2C948674C57B3ACDB3C10318119F1)] [added: [56](#sC1826A85D327545B97DDE4DD69032FB2)] |

| | [Consolidated Statements of [removed: Operations](#s45717C2FDB8A52F9912009621B898551)] [added: Operations](#s35AE0F70CA905462B016D8384CD5B27D)] | [removed: [52](#s45717C2FDB8A52F9912009621B898551)] [added: [58](#s35AE0F70CA905462B016D8384CD5B27D)] |

| | [Consolidated Statements of Comprehensive [removed: Income](#s048705BAA865557AAD2F7DA791A97F02)] [added: Income](#s4A004D0D697E548C8AC21F27C8174D26)] | [removed: [53](#s048705BAA865557AAD2F7DA791A97F02)] [added: [59](#s4A004D0D697E548C8AC21F27C8174D26)] |

| | [Consolidated Balance [removed: Sheets](#sCAF87665B81B5D59BE42873F354E5E52)] [added: Sheets](#s207183E6C7425CC795A96F4F19A2F7A6)] | [removed: [54](#sCAF87665B81B5D59BE42873F354E5E52)] [added: [60](#s207183E6C7425CC795A96F4F19A2F7A6)] |

| | [Consolidated Statements of Cash [removed: Flows](#s1BB35713784A569A881BB8062BEE62EB)] [added: Flows](#s6946B21E7B3C529E82BFB74F10156E7E)] | [removed: [55](#s1BB35713784A569A881BB8062BEE62EB)] [added: [61](#s6946B21E7B3C529E82BFB74F10156E7E)] |

| | [Consolidated Statements of Stockholders’ [removed: Equity](#sB22EBE79B2F55EE280FB1178B24D44C9)] [added: Equity](#s9CFC16D37DC6533CB2C3812A4ABBADBD)] | [removed: [56](#sE887311F57CF5D0796C1F73D52DB6036)] [added: [62](#s3182A788D4DE5BD0BC1346E79C2DE1FC)] |

| | [Notes to Consolidated Financial [removed: Statements](#sD29B2F422C6E533F9BDBDC86CE87CAA3)] [added: Statements](#sC34BB91AF330588A9CE261E8DEDE7C71)] | [removed: [57](#sD29B2F422C6E533F9BDBDC86CE87CAA3)] [added: [63](#sC34BB91AF330588A9CE261E8DEDE7C71)] |

| | [Schedule II – Valuation and Qualifying [removed: Accounts](#sCF01EE385292577087373E85B1353A00)] [added: Accounts](#s2BA924378D085778999CC31F25041978)] | [removed: [89](#sCF01EE385292577087373E85B1353A00)] [added: [97](#s2BA924378D085778999CC31F25041978)] |

| 21 | [Subsidiaries of the [removed: Registrant.](https://www.sec.gov/Archives/edgar/data/14693/000001469318000084/bfb-ex21_2018430x10kapril.htm)] [added: Registrant.](https://www.sec.gov/Archives/edgar/data/14693/000001469319000099/bfb-ex21_2019430x10kapril.htm)] |

| 23 | [Consent of PricewaterhouseCoopers LLP, independent registered public accounting [removed: firm.](https://www.sec.gov/Archives/edgar/data/14693/000001469318000084/bfb-ex23_2018430x10kapril.htm)] [added: firm.](https://www.sec.gov/Archives/edgar/data/14693/000001469319000099/bfb-ex23_2019430x10kapril.htm)] |

| 31.1 | [CEO Certification pursuant to Section 302 of Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/14693/000001469318000084/bfb-ex311_2018430x10kapril.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/14693/000001469319000099/bfb-ex311_2019430x10kapril.htm)] |

| 31.2 | [CFO Certification pursuant to Section 302 of Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/14693/000001469318000084/bfb-ex312_2018430x10kapril.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/14693/000001469319000099/bfb-ex312_2019430x10kapril.htm)] |

| 32 | [CEO and CFO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (not considered to be [removed: filed).](https://www.sec.gov/Archives/edgar/data/14693/000001469318000084/bfb-ex32_2018430x10kapril.htm)] [added: filed).](https://www.sec.gov/Archives/edgar/data/14693/000001469319000099/bfb-ex32_2019430x10kapril.htm)] |

| 101 | The following materials from Brown-Forman Corporation’s Annual Report on Form 10-K for the fiscal year ended April 30, [removed: 2018,] [added: 2019,] formatted in XBRL (eXtensible Business Reporting Language): (a) Consolidated Statements of Operations, (b) Consolidated Statements of Comprehensive Income, (c) Consolidated Balance Sheets, (d) Consolidated Statements of Cash Flows, (e) Consolidated Statements of Stockholders’ Equity, and (f) Notes to Consolidated Financial Statements. |

| 3.3 | [By-laws of registrant, as amended and restated on [removed: May 21, 2014,] [added: January 29, 2019,] incorporated into this report by reference to Exhibit 3.2 of Brown-Forman Corporation’s Form 8-K filed on [removed: May 22, 2014] [added: January 30, 2019] (File No. [removed: 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312514209796/d732013dex32.htm)] [added: 001-00123).](http://www.sec.gov/Archives/edgar/data/14693/000001469319000004/restatedby-laws.htm)] |

| [removed: 4.1] [added: 4.4] | [Indenture dated as of April 2, 2007, between Brown-Forman Corporation and U.S. Bank National Association, as Trustee, incorporated into this report by reference to Exhibit 4.1 of Brown-Forman Corporation’s Form 8-K filed on April 3, 2007 (File No. 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000095014407003019/g06451exv4w1.htm) |

| [removed: 4.2] [added: 4.5] | [First Supplemental Indenture dated as of December 13, 2010, between Brown-Forman Corporation and U.S. Bank National Association, as Trustee, incorporated into this report by reference to Exhibit 4.2 of Brown-Forman Corporation’s Form S-3ASR Registration Statement filed on December 13, 2010 (File No. 333-171126).](http://www.sec.gov/Archives/edgar/data/14693/000095012310113012/g25471exv4w2.htm) |

| [removed: 4.3] [added: 4.6] | [Second Supplemental Indenture dated as of June 24, 2015, between Brown-Forman Corporation and U.S. Bank National Association, as Trustee, incorporated into this report by reference to Exhibit [removed: 4.4] [added: 4.3] of Brown-Forman Corporation’s Form [removed: 8-K] [added: S-3ASR Registration Statement] filed on June [removed: 29,] [added: 24,] 2015 (File No. [removed: 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312515239509/d947872dex44.htm)] [added: 333-205183).](http://www.sec.gov/Archives/edgar/data/14693/000119312515232608/d943863dex43.htm)] |

| [removed: 4.4] [added: 4.7] | [Form of [removed: 1.00%] [added: 2.25%] Note due [removed: 2018,] [added: 2023,] incorporated into this report by reference to Exhibit [removed: 4.4] [added: 4.5] of Brown-Forman Corporation’s Form 8-K filed on December 12, 2012 (File No. [removed: 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312512500174/d454178dex44.htm)] [added: 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312512500174/d454178dex45.htm)] |

| [removed: 4.5] [added: 4.11] | [Form of [removed: 2.25%] [added: 3.75%] Note due [removed: 2023,] [added: 2043,] incorporated into this report by reference to Exhibit [removed: 4.5] [added: 4.6] of Brown-Forman Corporation’s Form 8-K filed on December 12, 2012 (File No. [removed: 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312512500174/d454178dex45.htm)] [added: 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312512500174/d454178dex46.htm)] |

| [removed: 4.6] [added: 4.8] | [Form of 1.200% Note due 2026, incorporated into this report by reference to Exhibit 4.5 of Brown-Forman Corporation’s Form 8-K filed on July 8, 2016 (File No. 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312516644569/d210478dex45.htm) |

| [removed: 4.7] [added: 4.9] | [Form of 2.600% Note due [added: Note due] 2028, incorporated into this report by reference to Exhibit 4.6 of Brown-Forman Corporation’s Form 8-K filed on July 8, 2016 (File No. 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312516644569/d210478dex46.htm) |

| [removed: 4.8] [added: 4.10] | [Form of 3.500% Note due 2025, incorporated into this report by reference to Exhibit 4.5 of Brown-Forman Corporation’s Form 8-K filed on March 26, 2018 (File No. 001-00123).](http://www.sec.gov/Archives/edgar/data/14693/000119312518096030/d558670dex45.htm) |

| [removed: 4.9] [added: 4.12] | [Form of [removed: 3.75%] [added: 4.00%] Note due [removed: 2043,] [added: 2038,] incorporated into this report by reference to Exhibit 4.6 of Brown-Forman Corporation’s Form 8-K filed on [removed: December 12, 2012] [added: March 26, 2018] (File No. [removed: 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312512500174/d454178dex46.htm)] [added: 001-00123).](http://www.sec.gov/Archives/edgar/data/14693/000119312518096030/d558670dex46.htm)] |

| [removed: 4.10] [added: 10.21] | [removed: [Form of 4.000% Note due 2038,] [added: [Letter Agreement between Brown-Forman Corporation and Jill A. Jones dated May 14, 2018,] incorporated into this report by reference to Exhibit [removed: 4.6] [added: 10.1] of Brown-Forman Corporation’s Form 8-K filed on [removed: March 26,] [added: May 16,] 2018 (File No. [removed: 001-00123).](http://www.sec.gov/Archives/edgar/data/14693/000119312518096030/d558670dex46.htm)] [added: 001-00123).](http://www.sec.gov/Archives/edgar/data/14693/000001469318000055/ex101-letteragreement.htm)] |

| [removed: 4.11] [added: 4.13] | [Form of 4.500% Notes due 2045, incorporated into this report by reference to Exhibit 4.5 of Brown-Forman Corporation’s Form 8-K filed on June 29, 2015 (File No. 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312515239509/d947872dex45.htm) |

| [removed: 4.12] [added: 4.14] | [Officer’s Certificate dated December 12, 2012, pursuant to Sections 1.01, 2.02, [added: 3.01,] and [removed: 3.01] [added: 3.03] of the Indenture dated as of April 2, 2007, as supplemented by the First Supplemental Indenture dated as of December 13, 2010, between Brown-Forman Corporation and U.S. Bank National Association, as Trustee, setting forth the terms of the [removed: 1.00% Notes due 2018, the] 2.25% Notes due 2023, and the 3.75% Notes due 2043, incorporated into this report by reference to Exhibit 4.3 of Brown-Forman Corporation’s Form 8-K filed on December 12, 2012 (File No. 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312512500174/d454178dex43.htm) |

| [removed: 4.13] [added: 4.15] | [Officer’s Certificate dated June 29, 2015, pursuant to Sections 1.02, 2.02, 3.01 and 3.03 of the Indenture dated as of April 2, 2007, as supplemented by the First Supplemental Indenture dated as of December 13, [removed: 2010] [added: 2010,] and the Second Supplemental Indenture dated as of June 24, 2015, between Brown-Forman Corporation and U.S. Bank National Association, as Trustee, setting forth the terms of the 4.500% Notes due 2045, incorporated into this report by reference to Exhibit [removed: 4.3] [added: 4.4] of Brown-Forman Corporation’s Form [removed: S-3ASR Registration Statement] [added: 8-K] filed on June [removed: 24,] [added: 29,] 2015 (File No. [removed: 333-205183).](http://www.sec.gov/Archives/edgar/data/14693/000119312515232608/d943863dex43.htm)] [added: 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312515239509/d947872dex44.htm)] |

| [removed: 4.14] [added: 4.16] | [Officers’ Certificate dated July 7, 2016, pursuant to Sections 1.01, 2.02, [added: 3.01,] and [removed: 3.01] [added: 3.03] of the Indenture dated as of April 2, 2007, as supplemented by the First Supplemental Indenture dated as of December 13, [removed: 2010] [added: 2010,] and the Second Supplemental Indenture dated as of June 24, 2015, between Brown-Forman Corporation and U.S. Bank National Association, as Trustee, setting forth the terms of the 1.200% Notes due 2026 and the 2.600% Notes due 2028, incorporated into this report by reference to Exhibit 4.4 of Brown-Forman Corporation’s Form 8-K filed on July 8, 2016 (File No. 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312516644569/d210478dex44.htm) |

| [removed: 4.15] [added: 4.17] | [Officers’ Certificate dated March 26, 2018, pursuant to [added: Sections 1.02, 2.02, 3.01, and 3.03 of] the [removed: indenture] [added: Indenture] dated April 2, 2007, as supplemented by the [removed: first supplemental indenture] [added: First Supplemental Indenture] dated as of December 13, 2010, and the [removed: second supplemental indenture] [added: Second Supplemental Indenture] dated as of June 24, 2015, between Brown-Forman Corporation and U.S. Bank National Association, as [removed: trustee] [added: Trustee,] setting forth the terms of the 3.500% Note due 2025 and the 4.000% Note due 2038, incorporated into this report by reference to Exhibit 4.4 of Brown-Forman Corporation’s Form 8-K filed on March 26, 2018 (File No. 001-00123).](http://www.sec.gov/Archives/edgar/data/14693/000119312518096030/d558670dex44.htm) |

| 10.2 | [removed: [A description of the Brown-Forman] [added: [Brown-Forman] Corporation Nonqualified Savings Plan, incorporated into this report by reference to Exhibit 4.1 of Brown-Forman Corporation’s Form S-8 Registration Statement filed on September 24, 2010 (File No. 333-169564).*](http://www.sec.gov/Archives/edgar/data/14693/000095012310088770/g24730exv4w1.htm) |

| [removed: 10.12] [added: 10.20] | [Five-Year Credit Agreement, dated as of November [removed: 18, 2011,] [added: 10, 2017,] among Brown-Forman Corporation, certain borrowing subsidiaries and certain lenders party thereto, [removed: Barclays Capital as Syndication Agent, Bank of America, N.A. and Citibank,] [added: JPMorgan Chase Bank,] N.A., [added: PNC Bank, National Association and Wells Fargo Bank, National Association,] as Co-Documentation Agents, U.S. Bank National Association, as Administrative Agent, and U.S. Bank National Association, Barclays [removed: Capital,] [added: Bank PLC,] Merrill Lynch, Pierce, Fenner & Smith [removed: Incorporated] [added: Incorporated,] and Citigroup Global Markets [removed: Inc.] [added: Inc.,] as [added: Co-Syndication Agents,] Joint Lead Arrangers and Joint Bookrunners, incorporated into this report by reference to Exhibit 10.1 of Brown-Forman Corporation’s Form 8-K filed on November [removed: 21, 2011] [added: 13, 2017] (File No. [removed: 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312511318306/d259727dex101.htm)] [added: 001-00123).](http://www.sec.gov/Archives/edgar/data/14693/000001469317000193/a20171110-fivexyearamended.htm)] |

| 10.13 | [removed: [Amendment No. 1 to Five-Year Credit Agreement, dated as of September 27, 2013, among Brown-Forman Corporation, the Lenders party to the Credit Agreement, and U.S. Bank National Association, as Administrative Agent,] [added: [Brown-Forman Corporation 2013 Omnibus Compensation Plan,] incorporated into this report by reference to Exhibit [removed: 10] [added: 10.1] of Brown-Forman Corporation’s [removed: Quarterly Report on] Form [removed: 10-Q for the quarter ended October 31, 2013,] [added: 8-K] filed on [removed: December 4,] [added: July 26,] 2013 (File No. [removed: 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000001469313000052/bfb-10312013xex10.htm)] [added: 002-26821).*](http://www.sec.gov/Archives/edgar/data/14693/000119312513304362/d573514dex101.htm)] |

| [removed: 10.15] [added: 10.12] | [Brown-Forman Corporation Amended and Restated Non-Employee Director Deferred Stock Unit Program, incorporated into this report by reference to Exhibit 10.2 of Brown-Forman Corporation’s Form 8-K filed on July 26, 2013 (File No. 002-26821).*](http://www.sec.gov/Archives/edgar/data/14693/000119312513304362/d573514dex102.htm) |

| 10.16 | [removed: [Brown-Forman Corporation 2013 Omnibus Compensation Plan,] [added: [Form of Restricted Stock Award Agreement,] incorporated into this report by reference to Exhibit [removed: 10.1] [added: 10.5] of Brown-Forman Corporation’s Form 8-K filed on July 26, 2013 (File No. [removed: 002-26821).*](http://www.sec.gov/Archives/edgar/data/14693/000119312513304362/d573514dex101.htm)] [added: 002-26821).*](http://www.sec.gov/Archives/edgar/data/14693/000119312513304362/d573514dex105.htm)] |

| [removed: 10.17] [added: 10.14] | [Form of Employee Stock-Settled Stock Appreciation Right Award Agreement, incorporated into this report by reference to Exhibit 10.3 of Brown-Forman Corporation’s Form 8-K filed on July 26, 2013 (File No. 002-26821).*](http://www.sec.gov/Archives/edgar/data/14693/000119312513304362/d573514dex103.htm) |

| [removed: 10.18] [added: 10.15] | [Form of Restricted Stock Unit Award Agreement, incorporated into this report by reference to Exhibit 10.4 of Brown-Forman Corporation’s Form 8-K filed on July 26, 2013 (File No. 002-26821).*](http://www.sec.gov/Archives/edgar/data/14693/000119312513304362/d573514dex104.htm) |

| 10.19 | [Form of [added: Performance-Based] Restricted Stock [added: Unit] Award [removed: Agreement,] [added: Agreement (Class B),] incorporated into this report by reference to Exhibit [removed: 10.5] [added: 10.3] of Brown-Forman Corporation’s Form 8-K filed on [removed: July 26, 2013] [added: August 1, 2016] (File No. [removed: 002-26821).*](http://www.sec.gov/Archives/edgar/data/14693/000119312513304362/d573514dex105.htm)] [added: 001-00123).*](http://www.sec.gov/Archives/edgar/data/14693/000001469316000227/a20160728-formofpbrsuclassb.htm)] |

| [removed: 10.20] [added: 10.17] | [removed: [Paul C. Varga July 25, 2013 Special Restricted] [added: [Form of Employee Stock-Settled] Stock [added: Appreciation Right] Award Agreement, incorporated into this report by reference to Exhibit 10.1 of Brown-Forman Corporation’s Form 8-K filed on [removed: July 30, 2013] [added: August 1, 2016] (File No. [removed: 002-26821).*](http://www.sec.gov/Archives/edgar/data/14693/000119312513308530/d575085dex101.htm)] [added: 001-00123).*](http://www.sec.gov/Archives/edgar/data/14693/000001469316000227/a20160728-formofemployeess.htm)] |

| [removed: 10.21] [added: 10.18] | [Form of [removed: Employee Stock-Settled] [added: Performance-Based Restricted] Stock [removed: Appreciation Right] [added: Unit] Award [removed: Agreement,] [added: Agreement (Class A),] incorporated into this report by reference to Exhibit [removed: 10.1] [added: 10.2] of Brown-Forman Corporation’s Form 8-K filed on August 1, 2016 (File No. [removed: 001-00123).*](http://www.sec.gov/Archives/edgar/data/14693/000001469316000227/a20160728-formofemployeess.htm)] [added: 001-00123).*](http://www.sec.gov/Archives/edgar/data/14693/000001469316000227/a20160728-formofpbrsuclassa.htm)] |

| 4.1 | [Description of Brown-Forman Corporation’s Class A Common Stock, par value $0.15 per share, and Class B Common Stock, par value $0.15 per share.](https://www.sec.gov/Archives/edgar/data/14693/000001469319000099/descriptionofcapitalstock.htm) |

| 4.2 | [Description of Brown-Forman Corporation’s 1.200% Notes due 2026.](https://www.sec.gov/Archives/edgar/data/14693/000001469319000099/descriptionof1200notesdue2.htm) |

| 4.3 | [Description of Brown-Forman Corporation’s 2.600% Notes due 2028.](https://www.sec.gov/Archives/edgar/data/14693/000001469319000099/descriptionof2600notesdue2.htm) |

| 12 | [Statement re Computation of Ratio of Earnings to Fixed Charges.](https://www.sec.gov/Archives/edgar/data/14693/000001469318000084/bfb-ex12_2018430x10kapril.htm) |

| 10.14 | [364-Day Credit Agreement, dated as of May 6, 2016, among Brown-Forman Corporation, certain lenders party thereto, Barclays Capital, as Syndication Agent, Bank of America, N.A. and Citibank, N.A. as Co-Documentation Agents, U.S. Bank National Association, as Administrative Agent, and U.S. Bank National Association, Barclays Capital, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Citigroup Global Markets, Inc., as Joint Lead Arrangers and Joint Bookrunners, incorporated into this report by reference to Exhibit 10.1 of Brown-Forman Corporation’s Form 8-K filed on May 6, 2016 (File No. 002-26821).](http://www.sec.gov/Archives/edgar/data/14693/000119312516581974/d127408dex101.htm) |

| 10.22 | [Form of Performance-Based Restricted Stock Unit Award Agreement (Class A), incorporated into this report by reference to Exhibit 10.2 of Brown-Forman Corporation’s Form 8-K filed on August 1, 2016 (File No. 001-00123).*](http://www.sec.gov/Archives/edgar/data/14693/000001469316000227/a20160728-formofpbrsuclassa.htm) |

| 10.23 | [Form of Performance-Based Restricted Stock Unit Award Agreement (Class B), incorporated into this report by reference to Exhibit 10.3 of Brown-Forman Corporation’s Form 8-K filed on August 1, 2016 (File No. 001-00123).*](http://www.sec.gov/Archives/edgar/data/14693/000001469316000227/a20160728-formofpbrsuclassb.htm) |

| 10.24 | [Five-Year Credit Agreement, dated as of November 10, 2017, among Brown-Forman Corporation, certain borrowing subsidiaries and certain lenders party thereto, JPMorgan Chase Bank, N.A., PNC Bank, National Association and Wells Fargo Bank, National Association, as Co-Documentation Agents, U.S. Bank National Association, as Administrative Agent, and U.S. Bank National Association, Barclays Bank PLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Citigroup Global Markets Inc., as Co-Syndication Agents, Joint Lead Arrangers and Joint Bookrunners, incorporated into this report by reference to Exhibit 10.1 of Brown-Forman Corporation’s Form 8-K filed on November 13, 2017 (File No. 001-00123).](http://www.sec.gov/Archives/edgar/data/14693/000001469317000193/a20171110-fivexyearamended.htm) |

| 10.25 | [Letter Agreement between Brown-Forman Corporation and Jill A. Jones dated May 14, 2018, incorporated into this report by reference to Exhibit 10.1 of Brown-Forman Corporation’s Form 8-K filed on May 16, 2018 (File No. 001-00123).](http://www.sec.gov/Archives/edgar/data/14693/000001469318000055/ex101-letteragreement.htm) |

| | [removed: |] [added: Director, President and] Chief Executive Officer [removed: and Chairman] of the Company [added: (Principal Executive Officer)] | [added: |]

Date: June 13, [removed: 2018][added: 2019]

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities on June 13, [removed: 2018,] [added: 2019,] as indicated:

| | [removed: Director,] [added: | President and] Chief Executive [removed: Officer, and Chairman of the Company |] [added: Officer] |

For the Years Ended April 30, [removed: 2016,] 2017, [added: 2018,] and [removed: 2018][added: 2019]

| Allowance for doubtful accounts | $ | [removed: 10] [added: 7] | | | $ | 1 | | | $ | — | | | $ | [removed: 2] [added: 1] | | (1) | $ | [removed: 9] [added: 7] | |

| Deferred tax valuation allowance | $ | [removed: 27] [added: 29] | | | $ | [removed: 3] [added: 1] | | | $ | [removed: —] [added: 1] | | | $ | [removed: 5] [added: 6] | | | $ | 25 | |

| | | /s/ Lawson E. Whiting |

| | By: | Lawson E. Whiting |

| /s/ Lawson E. Whiting | | |

| By: | Lawson E. Whiting | |

| | Director | |

| | | |

| --- | --- | --- |

| | | |

| /s/ Kelli B. Nelson | | |

| By: | Kelli B. Nelson | |

| 2019 | | | | | | | | | | | | | | | | | | | |

| | | /s/ Paul C. Varga |

| | By: | Paul C. Varga |

| /s/ Brian P. Fitzgerald | | |

| By: | Brian P. Fitzgerald | |