AUS: Australian Vintage steadies the ship in H1, outlook uncertain
- Half-year net profits down by 36.5% to AUD3.7m (US$4m)
- Net sales rise by 4.4% to AUD116m
- Pre-tax profits down by 13.3% to AUD4.2m
- Sees more robust business but dollar continues to eat profits
Australian Vintage has said its business was more robust in the first half of its fiscal year, but the high Australian dollar continues to threaten profits.
Stronger bottled wine sales to the UK helped Australian Vintage to report a 4.4% lift in net sales for the six months to the end of December, to AUD116m. There was also a sizeable lift in bulk wine sales to North America.
However, the high Australian dollar continues to pressure profits. The McGuigan wines producer witheld a dividend for the half-year due to an uncertain outlook.
Net profits for the six months slid by 36.5% on the same period of last year, to AUD3.7m, the firm said today (28 February). Excluding one-off gains in the previous year, net profits would have fallen by 3%.
Australian Vintage said that this underlying result "demonstrates how we have made our business more robust". Over the half-year, it used the sale of the Loxton Winery to reduce net debt from AUD161m to AUD134.8m.
Looking ahead, the group said that it will continue to invest in the McGuigan brand, which reported global sales up by 17% in volume terms for the first-half. It will also focus resources on Tempus Two, Miranda and Nepenthe brands.
Still, the group warned that it will be difficult to retain "positive momentum" in the UK should the Australian dollar remain so high against GBP sterling, even though it has currency cover a significant proportion of UK sales.
For the company's release, click here.
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