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Australian Vintage back in profit

Australian Vintage - formerly McGuigan Simeon Wines - posted a profit in 2007-08.

Switching emphasis from non-branded and bulk products to branded wines has begun to pay for the company, which recorded its first loss, of AUS$5.9m, in 2006-07.

It improved during the past year to post a $1.3m profit, which chairman David Clarke said was ‘a strong turnaround’.

However, four years ago the company posted a record profit of AUS$40.2m

Clarke and CEO Dane Hudson yesterday unveiled results which showed that sales of branded wines had increased 10.5%, branded wine exports increasing 22%. Non-branded sales were 34.4%.

Operating costs were 15% less and are expected to be reduced further with the AUS$60m sale of its Loxton winery, leaving it with one large-scale winery near Mildura.

‘Basically, Dane Hudson and his team have focused hard on profit versus sales,’ Clarke said. ‘They took a conscious decision to build new and existing brands at the expense of commodity wine.

‘At the same time they reduced costs and put the company in a stronger position by restructuring its asset base.’

Written by Chris Snow in Adelaide

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