(Reuters) - Jack Daniel's maker Brown-Forman Corp BFb.NBFa.N warned on Wednesday of trouble ahead from tariffs being slapped on U.S. bourbon and said it had been working in recent months to mitigate the potential impact by shipping more liquor overseas.

The spirit and wine maker was thrust into the spotlight last week when Mexico placed a 25 percent tariff on bourbon imports in response to President Trump’s imposition of import duties on metals.

The European Union has said it will also respond with levies and the company, while promising it was on top of the situation, said the issue made it hard for it to give a precise full-year outlook.

“It’s a tough, tricky situation that we’ve been watching now for months. It seems like every day we wake up and it takes a little bit of a twist and turn,” Brown-Forman Chief Executive Paul Varga told a conference call on fourth-quarter results.

Brown-Forman earns only half of its revenue from the United States, with Europe accounting for a quarter and Mexico and Canada contributing around 5 percent and 1 percent of net sales, respectively.

Shares of the Kentucky-based company were on course for their worst day in nearly seven years, falling 6.5 percent in afternoon trade as the company also warned of gross margin declines due to higher wood, agave and freight costs.

Varga said the company has gained more flexibility in managing trade risks by moving shipments to markets where it has its own distribution, rather than depending on third-party distributors.

Excluding the impact of any potential tariffs, the company expected earnings per share of $1.75 to $1.85 in fiscal year 2019, with the midpoint of the range coming in below the analysts’ forecast of $1.82 per share, according to Thomson Reuters I/B/E/S.

Net income for the company fell to $110 million, or 23 cents per share, in the quarter ended April 30, from $144 million, or 30 cents per share, a year earlier.

Net sales rose 5.6 percent to $733 million. Analysts had expected the company to earn 22 cents per share on revenue of $755.4 million in the quarter.