Winemaker's bubbling

Australian winemaker McGuigan Simeon said yesterday its first-half profit rose 15 per cent, driven by increased exports and domestic bulk wine sales.

The company expected to achieve full-year profit growth of 10 to 20 per cent despite tough conditions.

"We believe that competitive trading conditions for the industry driven by grape and wine oversupply will continue and the strong dollar will pressure export margins," chairman David Clarke said.

Net profit rose to A$12.4 million ($13.5 million) for the six months to December from A$10.8 million a year ago. The company's brands include the Black Label range. It also makes Black Swan wine for private United States company E. & J. Gallo and supplies the Australian Orlando Wyndham division of France's Pernod Ricard.

Chief executive Brian McGuigan said Black Swan was the second-highest selling Australian wine in the US, after Yellow Tail, made by privately owned Casella Wines.

He said the Black Swan range would be extended but McGuigan Simeon would now also put more effort into selling its own brands in the US and extending its activities after export earnings from North America slipped during the half.

McGuigan Simeon is the only midsized wine company left on the Australian Stock Exchange.

- REUTERS