Marlborough Wine (NZX:MWE) is holding strong, says annual report

Highlights

  • The annual report released by Marlborough Wine Estates.
  • Strong financial position with low debt recorded in the company’s annual results declared last month.
  • Strategies to market product extensively is said to be the future strategy of the Company.

Marlborough wine Estates Group Limited (NZX:MWE) has released its much-awaited annual report, announcing a strong financial position as well as a low-debt situation.

Marlborough Wine Estates’ fundamentals

Image source: © 2021 Kalkine Media New Zealand Lt; data source: Refinitiv

Image Description: Marlborough Wine Estates’ fundamentals

Financial results

In the annual results that were announced in late August for the 12 months closed 30 June, the loss after tax earned was NZ$0.6 million, owing to the year’s harvest. The lower yield resulted in an adjusted EBITDA of NZ$0.003 million. In terms of total sales revenue, there was a 5% growth, reaching at NZ$6.7 million.

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One of the consumer goods that were in demand despite the pandemic, wine has been subject to ups and downs this year. With the 2021 harvest update mentioning 20% lower wine production this year as compared to pcp, the silver lining was the premium wines which got time to mature well because of an extremely dry season.

What does MWE’s annual report indicate?

Bulk wine sales for the Company were seen at NZ$2.9 million, down by 22%, owing to low yield in 2021, despite the quality of the product being high.

Sale for branded wines saw an increase to 38,000 cases from 28,000 cases, which means a 41% increase in the sale of branded wines, amounting to NZ$3.9 million in revenue.

With the rise of online sales, wines have been bought digitally more than off the rack this year, considering uncertainties due to the coronavirus pandemic.

Further, it was added that domestic brand wines witnessed a surge of 45% this year, showing how people are open to the idea of exploration and trying new blends.

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Marlborough Wine Estates’ strategy

Currently, the strategy of the Company is to make investments in potential growth opportunities, which will further help in increasing the reach of their products in the future.

Countdown and Foodstuffs supermarket chains are examples where Marlborough Wines has made an investment in the marketing division to encourage the launch of a new line of products.

New Appointment

Jeff Clarke was appointed new Chief winemaker for the Company in December last year. He has brought about rich experience in premium winemaking, working with experts in the team to deliver the best possible results.

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On 27 September 2021, the Company traded at NZ$0.240, up by 4.35% at the time of writing.

The road ahead

In terms of outlook, the Company hopes to continue the growth streak by making strategic market decisions to help grow the range of products in the future. Work is also going to be done to make the product reach directly to consumers easily through online and direct sales.

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