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Foley Family Wines returns to first-half profit

Foley Family Wines returns to first-half profit as sales climb 21%

By Paul McBeth

Feb. 27 (BusinessDesk) - Foley Family Wines returned to a first-half profit as the food and beverage firm controlled by US businessman Bill Foley lifted sales 21 percent and didn't face a repeat of Kaikoura earthquake-related costs.

The Marlborough-based company reported a profit of $298,000, or 0.5 cents per share, in the six months ended Dec. 31, turning around a loss of $323,000, or 0.54 cents, a year earlier, it said in a statement. The year-earlier result was weighed down by a $989,000 charge on damage caused to its Grove Mill Winery after the Kaikoura quake. Still, a 21 percent increase in revenue to $20.1 million underpinned a more than doubling of underlying earnings to $1.6 million.

The company also bore $227,000 of costs associated with its $55 million acquisition of Mt Difficulty Wines, although the transaction isn't expected to settle until June this year.

Cases of wine sold rose 24 percent to 222,000, which chief executive Mark Turnbull put down to an "exceptional period" in competitions and accolades with eight trophies and 26 gold medals.

"These accolades lead to a significant increase in sales for the Dashwood range on wines," he said. "Our challenge moving forward is to ensure we capture more value for the quality of our wines we produce."

The new acquisition adds the premium Mt Difficulty and Roaring Meg brands to a suite which already includes Vavasour, Grove Mill and Te Kairanga, and Turnbull said the company's registering "genuine interest in our high quality portfolio from around the world".

"Once the Mt Difficulty purchase is completed, we will have the ability to satisfy the portfolio needs of any customer around the world requiring high quality New Zealand wine," he said.

The NZAX-listed shares last traded at $1.51, and have increased 0.7 percent so far this year.


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