Winecorp, the listed Stellenbosch own label wine supplier, registered headline earnings of 9.04 cents a share for the six months to 31 January, up from 4.16 cents for the same period last year.

The company's operating profit before exceptional items was R4.4m (US$0.39m) compared with R1.9m for period to January 2001.

Turnover for the six months was comparable with the that of the previous year, but operating expenses were down by R2.5m and there were exchange rate gains of R1.6m.

This was done by concentrating on an ongoing focus to eliminate non-strategic costs, resulting in a reduction of operating expenses. An exceptional income came from the disposal of Vineyards Direct, which was in line with the Winecorp's strategy of concentrating on core business.

The directors also made provision for a loan to the Winecorp employee share incentive scheme of R3.1m. This was inline with its policy of streamlining the balance sheet given the historic high volatility of the company's share price on the JSE Securities Exchange. It believed it was prudent to provide for this loan to the underlying net asset value of Winecorp's shares.

During the current period, Winecorp embarked on a R5.5m upgrade of its bottling capacity required to meet the expected demand generated by new clients both domestically and internationally. The benefits of this expansion are expected to reap benefits in the next financial year.

Although market conditions remained competitive, the directors believed the company was well placed to take advantage of opportunities that may arise. Management was focussed on expanding the order book for both local and international sales, while maintaining effective cost management.

Another director, Adrian Garforth resigned with effect from 28 March. This follows three resignations of three directors in the latter half of last year.