By Andrew Starke
Soft export sales have impacted on Australian Vintage’s bottom line with the wine producer this week reporting a significant slump in net profit for the financial year.
Total sales declined by 5 percent to $225 million although Australian Vintage CEO, Neil McGuigan, said the company had grown profitability for the year ended June 30, 2011.
Export sales fell 8 per cent although the branded bottled segment was 4 percent higher than the previous year.
Australian sales were in line with last year at $72 million with strong bottled sales offset by falls in cask wine and vineyard income.
AVL has adopted a number of operating and financial strategies to manage the record high exchange rate challenges, undertaking packaging and bottling operations in the UK to reduce production costs on exports.
“It is quite obvious that global financial uncertainty and volatility continues to impact individual countries, global trade and finance,” said Australian Vintage Chairman, Ian Ferrier.
“Unfortunately this uncertainty is slowing the recovery of the wine industry on many levels.
“The work AVL has done to reduce its cost base and build branded sales over the past few years has delivered a robust company.
”We are now a very low cost, flexible producer with a strong stable of brands.”
Earlier this month, the company announced the sale of 90,000 tonne Loxton Winery to TWG Australia for $27 million.
Proceeds from the sale have been used to service debt.