US: National Wine & Spirits profits tumble
National Wine & Spirits has posted a drop in net income for the nine months to 30 December. The US distributor said on Friday (10 February) that net income for the period dipped to US$4.6m versus US$8.4m for the corresponding period a year earlier. Sales for the nine-month period were up, however, to US$551m from US434.4m.
For the quarter to 30 December, sales were up to US$218.1m from US$159.1m, with net income dropping to US$1.4m from US$4.4m. "Countering the increased revenue (in the quarter), however, were flat revenue and gross profit in certain of the company's product sales markets, higher operating costs and increased interest expense, when compared to the prior year's comparable quarter," the company said.
"Net income of US$4.6m for the nine months ended December 30 is below the prior year's comparable period net income of US$6.1m, after excluding the one time receipt of the arbitration award of US$2.3m that occurred during the prior fiscal year," National noted.
Long-term debt increased US$52.8m from 31 March, 2005 primarily due to increased working capital needs of US$36m in the product sales segment and the funding of a US$14.9m deposit made in connection with the proposed acquisition of the stock of a Michigan wine wholesaler, L & L Wine and Liquor Corporation. National amended and increased its revolving credit facility by US$10m as of 30 December and after giving effect to this most recent amendment on its US$70m revolving line of credit facility the company had availability of US$14m.
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