Delegat's toasts Oyster Bay for profit rise

Delegat's Group has defied a worldwide recession and oversupply in the wine industry to return a 57 per cent rise in net profit for the year.

The winemaker says the overseas success of its Oyster Bay label is largely behind a 37 per cent jump in annual revenue.

Oyster Bay was leading the growth of the New Zealand wine category in global markets, managing director Jim Delegat said.

It was now one of the 10 most imported wines over $10 in America. "Which means it's becoming a must-stock wine on the shelves of major retailers throughout the US."

The winemaker, which also produces the Delegat's label, made $30 million in after-tax profits for the year to June, up from $20.4 million in the previous corresponding period.

Revenue rose to $229.4 million from $167 million.

Delegat believed the company had a resilient business model in that it was represented by its own people overseas and had the scale to promote Oyster Bay as a category-leading brand.

In the past year it had established a new 15-person in-market sales team in Canada to drive growth of the brand there.

He said 65 per cent of Delegat's production was sauvignon blanc, but was not overly concerned about it and New Zealand's heavy reliance on the variety.

"We're nowhere near the point of having maximised our distribution.

"There aren't many new wine styles in the world that have captured the attention in the last decade as Marlborough sauvignon blanc has."

However he acknowledged the recent oversupply problem, and said the company had got its inventory in line with demand. Delegat's 2009 harvest was 2 per cent below the forecasted yield. "Over the next two years we will be undersupplied."

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