14th October 2020 By Samantha Worthington | firstname.lastname@example.org | @foodtickernz
Palliser Estate Wines says its FY20 results were better than expected, despite numerous Covid-19 impacts.
The Martinborough winemaker posted a net profit after tax of $877,076 for the year ended June 2020, up from a net loss of $179,026 for the previous year.
In its annual report released on Tuesday, the company said total revenue was $3.99m, down by 17.86% on FY19.
A dividend of 20 cents per share was paid for the period. No dividend was paid last year.
Pallier said initial hopes of a profitable year faded as the impacts of Covid-19 hit the global economy.
“However, we’re delighted to report that in the last four months of the year sales were higher than expected and with costs significantly lower we delivered a pre-tax profit of $418,664,” the company said.
Palliser said it even saw a $12-per-case increase to $143 over the period – a lift of $33 per case since 2015.
The company said its 2020 vintage – the 31st for Palliser – was “very successful, especially given the extraordinary circumstances in which the team was required to operate”. About 480 tonnes of fruit was harvested, up 13% on the previous year.
The results were an indication of the progress Palliser said it had made in the past four years, allowing it to maintain “a strong financial position” – one it had to rely on as the pandemic struck.
“In the months before Covid-19 arrived, our journey towards greater value was on track,” the company said.
“However, as it did for so many businesses, the pandemic affected our domestic and international sales, with those in the United Kingdom and Australia taking the biggest hits due to our on-premises (restaurant) focus.
“We’re fortunate that the market diversification we’ve developed in recent years – in terms of product and channel mix – helped to smooth the impacts.”
Palliser said it expected to see more positive change as markets moved slowly out of lockdown.
The timing of a full market and economic recovery, however, remained uncertain.
“We certainly don’t expect a full recovery in the coming year,” the company said.
“With this in mind we’ve taken a conservative approach to our forecasts for 2020/21.
“We believe we’re in good shape, with a healthy balance sheet, a positive cash position and good market/channel diversification, and despite the challenges our outlook remains bright.”
The winemaker said it would continue to explore opportunities to evolve its business, which included different ways of going to market.
“For example, we’ve recently signed an agreement with an Australian wine management business that will enable us to access channels and markets in which we’ve not had a strong presence.
“We’re optimistic that, over time, this new arrangement will result in sales of at least 5,000 cases per annum in the key markets of Australia, China and the United States.”
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