Delegat toasts 61 per cent profit surge

Jim Delegat, managing director of Delegat Group, says good growing conditions produced quality and quantity. Photo / Richard Robinson

Jim Delegat says improved sales for Delegat Group wine in June helped a 61 per cent surge in full-year profits.

He said that the boost - along with changes to foreign exchange hedging - were key factors in an upgrade of profits to June 30.

The NZX listed company yesterday announced a pre-audit net profit after tax of $30 million to $31 million, from earnings before interest tax, depreciation and amortisation of $64 million to $65 million.

Audited results are to be announced late next month.

Delegat said the results were partly because its market leader Oyster Bay brand maintained its super premium place in a market with keen pricing.

"The improved profit was mainly as a result of a strong sales performance in the latter half of the fourth quarter, together with adjustments in the value of foreign exchange hedge instruments," he said.

"In spite of challenging conditions throughout the year the last quarter, sales have produced the desired result," he said.

Delegat said that after a bumper harvest in 2008 it was down 9 per cent this year and 2 per cent on expectations.

But he said favourable growing conditions throughout the summer season in the Hawkes Bay and Marlborough regions delivered both quality and quantity.

In its profit update Delegat's Group said it had successfully negotiated and renewed its banking facility and the average maturity for loans was two years.

On June 15 Delegat said:' 'For those producers who are able to succeed in establishing global distribution the future continues to look positive."

Delegat's products accounted for about 14 per cent of New Zealand's wine exports last year. additional reporting Bloomberg