Australian Vintage Limited (AVL) has delivered its results of financial year 2020 with net profit after tax (before the impact of new leasing accounting standard) of $11.4 million, up 41 per cent over the previous financial year.
Earnings before interest and tax (EBIT) is up 18 per cent to $19.2m on revenues of $267.1m.
AVL Chief Executive, Craig Garvin, said: “This strong performance underlines the strengths of our brands, and the ongoing transformation of our business. Especially in a year which was not without its challenges.
“We are well advanced in our plans to grow our brands and our business over the coming twelve months. Our Asian and North American markets have been underperforming and have not been consumer focused.
“We have taken the necessary corrective action which makes the 2020 result all the more positive. The team has worked hard on setting up our business for strong growth in our portfolio which is a key focus moving forward.
“We are very aware of offsetting the risks this business faced and now move to a branded portfolio strategy.
“The performance of our operations has been particularly pleasing. Despite the industry suffering declines in grape production across the total Australian wine sector, AVL has been able to improve its yield. This combined with our excellent assets sets up well when combined with our portfolio approach.
“A complete review of the leadership group and strategy has been completed and the necessary changes made. I am confident of a stronger return on investment in line with market expectations moving forward.”
AVL’s Australian business performed will with all pillar brands seeing growth; sales of the McGuigan brand grew by three per cent, while Tempus Two saw 42 per cent growth.
Despite the on-premise and cellar door segments declining due to Covid-19, the Australian business delivered a profit result 18 per cent up on year ago. The company said that the “combination of consumer focus with retail partners, innovation and strong cost control all contributed to the positive result in very challenging circumstances”.
Looking ahead, Garvin said: “I am pleased with operational capability of the business. Our focus now shifts to driving branded growth across our key markets. We are creating a business where sales are consumer driven.
“To do so we must invest in our people, brands, and customer partnerships globally to ensure we leverage the capital investments made. The last six months have been challenging however our business has performed very strongly which gives me confidence moving forward. The changes we have put in place are starting to deliver solid results.
“Whilst Australia and the UK have been the primary focus for growth this financial year, Asia and North America will see improved business performance over the coming years and present significant growth opportunities for AVL. I am confident we have put in place the right structural changes and strategy to ensure continued improvement”.