Good morning. Welcome to Corby Spirit and Wine's Fiscal Year 25 Q1 Financial Results Conference Call for the period ended September 30, 2024. Joining me on the call this morning are Nicolas Krantz, President and Chief Executive Officer, and Juan Alonso, Vice President and Chief Financial Officer. Hopefully, you have had the opportunity to review the press release which was issued yesterday. Before we begin, I would like to inform listeners that information provided on today's call may contain forward-looking statements which can be subject to risks and uncertainties that could cause actual results to differ materially from those anticipated. Risks and uncertainties about the company's business are more fully discussed in Corby's materials, including annual and interim MD&A filed with the securities regulatory authorities in Canada as required. At this time, all participants are in a listen-only mode. Following management's commentary, we will conduct a Q&A session.
Instructions will be provided at that time for you to queue up for your questions. If you have any difficulties hearing the conference, please press star zero on your phone for operator assistance or click the help button on your screen. Now, I would like to turn the call over to Mr. Krantz. Please go ahead.
Thank you very much, and good morning, everyone. I am Nicolas Krantz, and it's a pleasure to connect with you today. I'm joined by Juan Alonso, our CFO, to share our results for the first quarter of fiscal year 2025. So, as you may be aware, the last fiscal year marked a significant journey for Corby. Guided by our vision to be the most innovative and consumer-centric company in the industry, we made substantial strides in reshaping our company's profile, and these efforts have driven Corby to outperform the market again. So, I'm proud to say that we have maintained this momentum and started this fiscal year with a solid performance. Juan will, of course, give you more detail in our results soon, b ut I can start by highlighting our Q1 results. We show a double-digit revenue growth of 11%, underpinned by our acquisition of the new RTD business.
Our organic revenue also saw a resilient increase of 3%, supported by solid execution and the diversity of our portfolio of brands. This is despite, of course, a volatile context where the LCBO labour strike severely impacted the entire beverage alcohol industry. I will come back to it. It is clear that our acquisition of ABG and the new brand were pivotal in achieving our ambition to be a key player in Canada in this highly attractive, fast-growing ready-to-drink category. These acquisitions directly contributed to our growth. This growth is further supported by RTM modernization in Ontario. That's a big change for us. We are already seeing increased initial stocking demand with RTD and wine now being sold in grocery and convenience stores, which is for us a great opportunity to drive this demand through a specialized route-to-market strategy.
Our success extends beyond RTD, of course, and we continue to deliver resilient retail value sales across our expanded and diverse portfolio of brands, and by leveraging our portfolio effectively, we have consistently outpaced the overall spirits market for over two years now in a row, so the strong commercial and business performance for Corby's portfolio is evidenced in our long-term strategy and execution of what we have called our Corby 2.0 roadmap. It's starting to bear fruit. We have embraced a digital transformation that really makes us a very effective and impactful company in the marketplace, so our redefined portfolio prioritization strategy is clearly demonstrated in effectiveness, supporting our sales team, enhancing our sales execution, amplifying across all our brands through diverse price points.
This strong competitive advantage sets Corby apart from the rest of the industry, demonstrating that Corby is the best in class at the moment in the industry. Finally, for this overview and something that Juan will expand on, we have generated strong cash flow that ensures Corby to remain in a healthy spot in terms of net debt to EBITDA with a ratio of 1.8 times. Now, before I give Juan the floor to provide an overview of our Q1 financial performance, I want to provide quickly some market context on the environment we've been operating in Q1. The market in general has experienced a moderate decline over the last 12 months, with a drop in the last three months due to the negative impact of the LCBO labour strike in Ontario.
But combining our performance in spirits, ready-to-drink, and wine in the last 12 months to September, we outperformed the market in value by 150 basis points, with the overall market retail sales in decline at - 1.1%, while the Corby overall portfolio slightly grew by + 0.4%. And again, this highlights the value of our strategic focus and execution. We are proud to be the second-largest player in Canada, with three of the top 10 spirits brands in Canada in our portfolio, along with a strong ready-to-drink business. RTD, of course, continues to be a bright spot, both in the short term and the long term, and with early benefits from the Ontario route-to-market modernization to be fully realized in the following months.
Our recent acquisition has set us apart for success in this strong category, and the recent acquisition of Nude also gives us a great opportunity to accelerate in that space. Now, as you can see in the next slide, our strategy has enabled us to outpace the market in almost all spirits categories, and this is quite remarkable. Our overall spirit portfolio grew by +0.7%, almost two points above the market. And this is, as I said, a testament to our diversified portfolio and our commitment to innovation. So, that's the market context. Now, let me turn it over to Juan to do a deep dive on our Q1 results for this fiscal year. Over to you, Juan.
Thank you, Nicolas. Good morning, everyone. I'm Juan Alonso, Corby's CFO, and I'm very pleased to present to you today Corby's financial results for the first quarter of fiscal year 2025. Very quickly, before we talk about our financial performance, you're going to notice some mentions of adjusted metrics and organic revenue growth. We believe that these non-IFRS financial measures support a better understanding of our underlying business performance and trends. We provided detailed explanations of each of those elements in our Q1 fiscal year 2025 MD&A, and I invite you to refer to this document for any questions related to it. Now, stepping back to the quarter results, I want to highlight that Corby delivered a solid Q1 with accretive contribution of the newly acquired RTD business, ABG and Nude, and ongoing market share gains in spirits despite a volatile market environment.
Revenue for the first quarter was CAD 65.1 million, reflecting a double-digit reported growth of 11%, benefiting from the inclusion of Nude sales of CAD 4.9 million. Our organic revenue, which excludes the contribution from Nude, saw a resilient increase of + 3%, driven by solid execution and diversity of our product portfolio despite the negative impact of the LCBO strike. Reflecting the strong revenue growth and a more modest expense growth, Corby delivered robust improvements in earnings and profitability in the first quarter of fiscal year 2025, with adjusted earnings from operations of CAD 15.6 million, increasing + 9% versus last year.
Despite increased interest charges related to the loan contracted to acquire ABG, Corby delivered adjusted net earnings per share of CAD 0.36, increasing by + 7% year- over- year. Corby delivered cash flow from operating activities at CAD 3.7 million, a remarkable improvement of CAD 8.5 million versus previous year cash flow.
From an overall leverage standpoint, Corby remained in a healthy spot with a net debt adjusted EBITDA of 1.8 times. Finally, the board of directors declared yesterday a dividend at CAD 0.22 per share for the first quarter of fiscal year 2025, staying consistent to the fourth quarter of fiscal year 2024. Now, let's dive into our revenue performance. As mentioned earlier, our Q1 revenue grew + 11% year- over- year, boosted by the inclusion of Nude revenue, while our organic revenue recorded a resilient 3% growth, broken down into the following main components. First, our domestic case goods revenue had a robust 13% growth, which benefited greatly from the inclusion of Nude's CAD 4.9 million revenue. Excluding Nude, our organic domestic case goods remained resilient and gained + 2% despite facing the negative impact of the LCBO strike in July.
This is mostly led by our RTD portfolio, more particularly Cottage Springs, enhanced by the route-to-market modernization in Ontario. Then, our total commission grew by 17% in Q1, with sales of represented Pernod Ricard products benefiting from stronger pre-ordering patterns ahead of the holiday period and also cycling the stocking patterns at liquor boards in previous years. This is partially offset by the decline from some agency brands no longer represented by Corby. Lastly, our international case goods revenue was down by 16%, lapping pipeline fill to new markets last year, despite the recovery of shipments of J.P. Wiser's in the US. To add some colors to our Q1 results, I can highlight the biggest factors impacting some of our key brands.
Starting with the J.P. Wiser's family, our flagship brand, Q1 revenue was impacted by the LCBO strike, amplified by increased promo spend in some provinces, and resulted in a -12% decrease in shipments and - 7% in revenue. However, with the NHL season well underway as we speak, and Wiser's recently becoming the new official whisky of the NHL, we expect some improvements in the coming months. As mentioned earlier, our Q1 revenue growth can be largely attributed to our RTD portfolio strengthened by our acquisition of ABG brands last year. Cottage Springs remained a key driver of growth in the ABG portfolio, benefiting from the pipeline fill to groceries and convenience stores in Ontario. ABG's performance was further accelerated by the inclusion of Nude brands. Overall, ABG had a tremendous + 45% volume growth that led to 39% value growth.
Polar Ice Vodka recorded a strong shipment growth of 32% and revenue growth of 23%, with sales growth enhanced by ready-to-drink innovation launches, predominantly in Ontario and British Columbia. Finally, as mentioned earlier, our total commission income grew 17% versus last year. As mentioned earlier by Nicolas, Corby represented the spirits retail sales has beaten the overall spirits market's retail value growth for over two years in a row. To summarize our P&L results for the first quarter, we enjoyed significant revenue growth of 11%, driven by recent acquisitions with resilient performance of our domestic case goods despite the negative impact of the LCBO labour strike. Without Nude's contribution, our organic revenue grew +3% versus last year.
Our total operating expenses increased by 6% to reflect strategic investments behind key strategic brands and also diligent cost management, lapping CAD 2.8 million of accounting impact of ABG inventory adjusted to its fair value in the first quarter of fiscal year 2024. As a result, our adjusted earnings from operations grew 9%, while reported earnings from operations grew 31%. When we exclude certain non-cash expenses, we also enjoyed a strong growth of 8% in adjusted EBITDA. Our adjusted net earnings per share was CAD 0.36, reflecting compelling growth of 7% in Q1 fiscal year 2025 versus last year, despite higher interest charges related to the loan to acquire ABG. Now, moving to our cash flow, in Q1, Corby generated CAD 3.7 million of cash from operating activities, supported by higher net earnings as well as favorable working capital changes.
Those favorable working capital changes were driven primarily by timing of promotional spend due to seasonality of the business. Operating cash flows also included higher interest charges due to the loan to acquire ABG. Our free cash flow greatly improved as our investing activities last year reflected the payment of CAD 136 million for the acquisition of ABG on July 4, 2023. Our resulting net debt position was CAD 109 million at the end of September, with a net debt to adjusted EBITDA ratio of 1.8 times, indicating a healthy leverage position. Our dividend payouts remain attractive. The CAD 0.22 of dividends paid in Q1 represents 94% of net earnings and 61% of operating cash, which enables us to start amortizing our debt while continuously delivering value to our shareholders. As you can see, at the end of Q1, we have a dividend yield of 6.7%.
Now, I would like to hand over back to Nicolas to cover Corby's growth strategy and to give some words at fiscal year 2025 outlook.
Thank you very much, Juan. Very clear. So, effectively, before we finish, I want just to share a goal for the future that is clearly to focus on sustainable growth, innovation, and efficiency. So, first and foremost, our goal is to grow a portfolio at a faster rate than the overall spirit market. That's really our obsession every month. We aim to achieve this through best-in-class brand activation and excellence in our commercial execution. This is really our competitive advantage with our sales team from coast to coast. Our target, as well, is that our innovation should contribute roughly to one-third of our annual revenue growth. That's why we are also obsessed to bring a very dynamic pipeline of innovation with our key partners throughout the country. Also, by improving the efficiency and the effectiveness of every dollar we invest in advertising and promotion, we will maximize our returns.
We are also committed to, of course, accelerating growth and penetration in the high-growth categories. This includes, of course, scaling our RTD portfolio overall, but also to take our fair share in some fast-growing segments like tequila. Export, while remaining a small part of our business, is another key focus, particularly with Canadian whisky in the US, which is a huge opportunity, and we will adopt a targeted steady approach, this regional activation to embed J.P. Wiser's in local repertoire of choices. Now, growing value ahead of volume remains a mantra for our company. So, we will implement a targeted price increase approach to protect our margin while fully leveraging our RGM capabilities supported by AI. And last, of course, but not least, we will, of course, continue to roll out our dynamic portfolio management roadmap, and this includes considering, if relevant, the divestment of less strategic assets.
Now, for the year ahead, and in the context of a declining or slightly declining spirits market affected by the LCBO labour strike during this first quarter, we think, however, we are well-positioned to succeed in this fiscal. We will continue to target market share gain, as I said, and we feel our portfolio strategy and our ongoing digital transformation can deliver on that. We will seek to unlock the full potential of our RTD portfolio, and that includes, of course, the realization of ABG and Nude sales with operational synergies throughout the successful integration. And as we have mentioned, revenue growth management and disciplinary investment will remain very important to protect our margin.
Finally, we keep an agility regarding the dynamic approach of these new opportunities in the route-to-market, where wine and RTD portfolio can expand at pace, and during Q1, we have seen some great already involved in that space. Now, finally, before we head into all your questions, I would like just to leave you with our usual key reasons to invest in Corby. Corby is today the largest publicly listed company in the industry in the alcoholic beverage industry in Canada, and as I mentioned, our portfolio is the most comprehensive portfolio in the market, and we are very proud of that, and we know that this is delivering value. Now, coupled with our strong position here, we can leverage our close partnership with Pernod Ricard, who is a global industry leader, and this gives us a lot of competitive advantage in this marketplace.
We have operational excellence, of course, in execution. We are well-known for that, and we are attracting some strong sales and marketing talent. And with that, we will continue to deliver and focus on our execution. Now, finally, of course, the company will deliver, and I think this is what I call financial consistency. It's a very important part of who we are. We are resilient no matter what our revenue, and we generate a strong cash flow. And with that, we'll continue to adapt our financial policy to maintain this. We know very well that dividend is an important feature for our shareholders, and of course, we aim to continue to grow the dividend over time with the earnings. So, that's it for us today. I want to thank you very much again for joining us and connecting for a quick overview of our Q1 results.
I look forward to speaking with you in the future, but of course, for just now, let's take the opportunity to take any question that Juan and myself will be happy to answer.
Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by one on your touch-tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by number two. If you are using a speakerphone, please lift the handset before pressing any keys. Thank you, ladies and gentlemen. That concludes our question and answer session. I will now turn the conference back over to Mr. Nicolas Krantz for closing remarks.
Again, thank you very much for joining. I wish everyone a good day and a good end of the week. As I like to say, the best way to get to know Corby is to enjoy your brand responsibly. The weekend is soon approaching, so I wish you a very good weekend and enjoy your brands responsibly. Thank you.
This concludes today's conference. Thank you for attending. You may now disconnect your lines.