By Deborah Jackson, editor National Liquor News
Australian Vintage Limited (AVL) has reported a total revenue increase of eight per cent to the end of April 2016 on the back of strong branded sales.
The increase in revenue is a reflection on higher branded sales in the UK, Europe, Australasia, and North America, however it was partially offset by lower bulk wine sales.
Neil McGuigan (pictured), chief executive officer of AVL, said: "Australasia/North America sales are up eight per cent on last year with bottled sales up 19 per cent and cask sales down 20 per cent. Cask sales are down due to significant pricing pressure.
"Sales of our bottled product into UK/Europe are up 19 per cent on last year due mainly to the increased sales footprint in the UK market. Bulk sales into this market are down by 77 per cent compared to last year as we continue to focus on changing from a bulk wine producer to a branded business.
"Sales of our three key brands, McGuigan, Tempus Two and Nepenthe continue to grow with sales to the end of April up 20 per cent on last year.
"AVL's commitment to quality has recently resulted in three of the McGuigan Black Label red wines being recognised in the top five selling red wines in Australia. This commitment to quality was again reinforced at the International Wine Challenge held in London where the McGuigan brand was awarded four Trophies, five Gold, nine Silver and 12 Bronze medals including the Trophy for the Best Australian White Wine of Show for the 2010 Shortlist Eden Valley Riesling. AVL will continue to push the boundaries with quality wine production and vineyard innovation to continue to enhance Australia’s reputation globally," said McGuigan.
Meanwhile, the company terminated its Del Rios vineyard lease and paid the $4.9 million termination fee earlier this year. This termination together with the recent expiry of other onerous third party grower contracts will provide significant savings in future grape costs.
“The company continues to focus on increasing branded sales and at the same time improving the efficiency of the business and improving the quality of our outstanding wines. We remain confident that our core strategies are correct,” said McGuigan.
"Subject to no material changes to the current exchange rates we remain confident that our 2016 net profit before one off items will be up 10 to 15 per cent on last year’s $7.1 million net profit after tax and before one off items."