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Delegat lifts profit 15% in 2018, sees rising case sales out to 2021

Friday 24th August 2018

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Delegat Group, New Zealand’s largest listed winemaker, lifted profit 15 percent in 2018, boosted by a revaluation of its biological assets, and confirmed its growth outlook for the next three years.

Net profit was a record $46.8 million for the year ended June 30, on an 8 percent lift in revenue to $272.1 million. In July, the company said unaudited operating profit for the year would be $44.9 million, a figure it confirmed today.

The bottom line was boosted by the fair value of the company's grapes increasing $5.5 million, while derivative financial instruments were written down by $2.9 million. The company booked a total revaluation gain of $1.9 million in the year, net of tax.

The winemaker, whose stable includes the Oyster Bay brand, sold 2.7 million cases globally in 2018, up 3 percent on a year earlier. It saw a 10 percent gain in case sales in its biggest market North America, to 1.25 million, offsetting a 7 percent drop from UK, Ireland and Europe to 687,000. Its case sales in New Zealand, Australia and Asia Pacific rose 2 percent to 799,000. 

Delegat reiterated its June forecast for global case sales to be 2.95 million in the current year, 3.17 million in the year to June 2020 and 3.38 million in the year to June 2021. It forecasts 2019 operating profit to grow in line with global case sales growth, based on prevailing exchange rates. 

The board declared a 15 cent final dividend, payable Oct. 12 with a Sept. 28 record date.

The shares last traded at $9.99 and have gained 24 percent so far this year. 


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