'UK still challenging' – Australian Vintage
McGuigan wine firm Australian Vintage has warned that it still faces challenging times ahead in the UK market despite a surge in volumes and profits for the business as a whole.
Volumes sales of bottled wine were up 19% in the six months to December 31, with net profits before exceptional items ahead 112% at A$3.8 million.
Export sales were down slightly but profits from exports almost doubled as a result of improved distribution efficiencies and a shift in product mix towards branded wines.
Chief executive Neil McGuigan said: "The results are a significant achievement, given the 13% appreciation of the Australian dollar against the British pound, AVG's key export market.
"We can see real bottom line benefits in both increased [total] sales and reduced costs from efforts over the past few years.
"Our inventory levels are up slightly compared to the same time last year but remain in balance, and we are tightly managing every aspect of the business."
Chairman Ian Ferrier added: "The economic conditions in the UK in particular will make future sales and margin growth challenging."