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Wine exporter Delegat's Group posted a record performance yesterday with global economic woes yet to hit the company.
Net profit for the six months ending December 31 soared 146 per cent to $15.7 million on the back of a 49 per cent rise in revenue to $127.3 million.
The NZX-listed company said it was confident of delivering a full-year result in line with analyst consensus of $24.7 million, compared with $19.1 million the previous year.
Shares closed steady at $2.05 yesterday.
Managing director Jim Delegat said the company had to acknowledge that the world was a different place and there would be some effect from the economic downturn. "We may be part of that but at the moment we haven't seen it in [the] Oyster Bay [brand]," he said.
"They haven't been popping champagne corks in London for Christmas but they're buying a lot of Oyster Bay."
Chief financial officer Andre Gaylard said the company had a net debt to equity ratio of 50.3 per cent, considerable headroom and was in the process of re-negotiating finance facilities coming up for maturity.
"We believe if we renegotiate the facilities we have currently that they will be able to stand us in good stead for a while," Gaylard said.
Delegat said the company's bank was very pleased. "So we've taken the opportunity to just buy a little bit of land. We're doing some vineyard development, about $20 million worth, I think."
New Zealand wine industry exports grew by 19 per cent last year to $904 million, with a target of $1 billion of exports brought forward to this year.
Last season's total industry grape harvest rocketed 39 per cent to 285,000 tonnes, resulting in an oversupply for the first time in many years. Delegat's was seeing benefit from lower grape prices, including a drop of about $400 to $500 a tonne for sauvignon blanc.
The company had been spoken to about the prospect of buying some estates, Delegat said.
"We're not in the mind to rush in because we need to be careful, we're in balance."
The domestic market had a good six months, Britain and United States markets had shown good growth but the real winner was Australia, Delegat said.
The company increased its Australian trade prices by 3 per cent this month where a fight was under way between retailers Coles and Woolworths.
"Because they continue to compress their margins and sell wine below what we prefer we continually put our trade pricing up. This has always been the case."