US: Willamette Valley FY soars, 2008 looking tough
Willamette Valley Vineyards has posted a healthy lift in full-year sales and profits, but has warned that it faces a tough year ahead.
The Oregon-based wine company said late last week that net profit for the year to the end of December leapt by 31% to US$1.7m, with sales rising by 12% to $16.7m. Operating profit also headed north, rising to $2.7m from $2.2m a year earlier.
"These historical results were due principally to our winemaking and sales teams working closely together to organise pre-orders and ship when the wine was ready to release," said Jim Bernau, Willamette's founder and president. "During 2007, we received orders in excess of our supply of Pinot Noir and Gris."
"We are expecting the fine wine market to slow during this economic downturn," Bernau warned. "Sales in the first quarter of 2008 are weaker than the prior year's first quarter sales."
The company has suffered inventory outages of three Pinot Noir products and distributors ordering in smaller quantities to reduce their inventory levels. Restaurant customers in the US, with whom Willamette is in contact, are reporting less revenue than the prior year. "Management believes this weakness could be temporary as additional, new Pinot Noir inventories are aging and sales of the company's wines from its distributors' warehouses to their customers are up nationally for the first quarter by 12%."
Willamette had run the risk of being delisted from the NASDAQ stock market, due to a delay in filing its full-year results. The company was late in issuing the filing due to a time lag between its audit and a final review from its auditors.
The 2007 harvest is expected to yield approximately 134,000 cases of winery-produced wines, the company added.
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