CHILE: Profits fall sharply at Concha y Toro
Vina Concha y Toro has posted a 50.5% drop in net income for the third quarter to CHP3.95bn (US$ 7.5m), while net income for the nine-month period fell by 20.2% to CHP15.0bn (US$28.4m).
The Chilean wine producer attributed the fall in profit primarily to the appreciation of the Chilean peso. "Company results have been strongly affected by the appreciation of the Chilean peso against all the currencies in which it invoices its exports, mainly the US dollar, the euro and the pound sterling," said Concha y Toro's CEO Eduardo Guilisasti. "There was also the impact of the higher cost of wine as a result of increases in the price of grapes in the 2005 harvest."
However, in spite of the third-quarter and nine-month performance, Guilisasti pointed out the company's exports in dollar terms had increased by 14.4% in the nine-month period and by 6.7% for the third quarter, and the company was performing solidly in the US.
Guilisasti also said that in the domestic market, the company was benefiting from its medium-term strategy to seek to recover profitability. Domestic revenues increased by 19.4% for the nine-month period and by 18% for the quarter, which the company said was achieved with a higher average price and increased volumes.
Operating income fell by 44.4% to CHP5.73bn in the third quarter, and by 16.2% for the nine-month period to CHP20.69bn. Consolidated revenues rose by 7% for the first three quarters to CHP148bn but fell by 0.6% in the third quarter to CHP54.56bn.
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