CANADA: Magnotta Winery sees nine-month profits fall
- Nine-month net profits down by 9% to CAD2m (US$1.97m)
- Net sales dip by 0.2% to CAD19.8m
- Ontario sales tax blamed for profits fall
- Group posts Q3 rises
Magnotta Winery blames sales tax for profits fall
Magnotta Winery has reported a fall in nine-month profits and a dip in wine sales, despite growth in the third quarter.
Magnotta said today (14 December) that net sales for the nine months to the end of September dipped by 0.2%, to CAD19.8m (US$19.4m). Net profits fell by 9% on the same period of 2010, to CAD2m.
Magnotta blamed the fall in profits on a new tax on wine imposed by the Ontario Government as of 1 July 2010. The so-called Cellared-In-Canada (CIC) wine tax charges a levy on wine sold through private retail stores in the province, as part of a strategy to harmonise sales tax.
However, the Ontario-based wine group enjoyed a better third quarter. For the three months to the end of September, net sales increased by 2.3% to CAD7.64m, while profits rose by nearly 6% to CAD0.69m.
Last month, Magnotta Family Holdings said that it would take the wine company private. Shareholders will be asked to vote on the proposal on 18 January.
To view the company figures, click here.
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