Delegat's half-year profit slides
Lower sales and higher costs have resulted in listed winemaker Delegat's Group reporting a 7.6 per cent slump in net profit for the half year to December 31.
The profit of $17.2 million was dragged down by a 1.8 per cent dip in sales revenue to $121.2m compared with $123.4m in the same period in 2012, while the volume of wine sold was almost unchanged with case sales down by 0.6 per cent to 1083 million cases.
Higher sales and administration costs and finance charges pushed up total expenses to $50m from $46.1m.
The company said its in-market case price realisations – the prices it sells its wine at in each market's local currency – were being maintained and its lower sales revenue was largely the result of adverse changes in foreign exchange rates.
Average case revenue was $119.9 per case compared with $113.20 a year earlier.
The export mix had changed, with case sales to Britain and Europe down 14 per cent and case sales to the United States up 15 per cent, while sales to Australia, Asia and the domestic market were flat.
Inventory was 49.75 per cent higher at $74.1m compared to $49.5m at the end of 2012.
There were also upward revaluations of property plant and equipment to $241.8m from $201.9m and in the value of the company's grape vines to $63.13 from $57m.
Net tangible assets increased to $2.22 per share from $1.94 a year earlier.
The company said its directors continued to have confidence in the resilience of the group's business model and its ability to deliver sustainable earnings in the future. It was on track to achieve operating profit in line with consensus forecasts of $29m.