The New Zealand Wine Company has multimillion dollar losses for 2011 - a sign of the wider financial malaise facing the country’s wine industry.
NZWC, which produces the Marlborough eco-brand Grove Mill, reported a loss of NZ$3.18m (£1.63m) in the year to June 2011 in addition to a shortfall of NZ$1.89m (£97,000) the previous year.
Chief executive officer Rob White said, ‘the combination of the over-supply of grapes, a strong NZ dollar and the global financial crisis has put intense pressure on revenue, margin, net earnings and cash flow management for all NZ wineries and grape growers and has resulted in NZWC posting a significant loss.’
It admitted it might be forced to reduce its activity in both the UK and US if the strong New Zealand dollar did not weaken against the pound and US dollar in the coming twelve months.
According to its accounts, NZWC owed a total of NZ$17.25m (£8.87m).
In June, ANZ bank agreed to waive a breach of a financial covenant ratio, subject to a review of the wine company’s financial forecasts.
Written by Rebecca Gibb in Auckland