McGuigan wines report low yield vintage, outstanding wines and reduced profits

Mark Dadswell/Getty Images

Australian Vintage, the owner of McGuigan wines, expects a 10% drop in profits after low grape yields from its vineyards.

The latest vintage is down 10,444 tonnes of grapes to 113,771 tonnes compared to last year mainly due to damage from frosts.

CEO Neil McGuigan says the 2015 vintage has produced some outstanding wines but he expects profit will be about 10% down over the full year because of lower volumes.

Net profit for the half year to December was up 10% to $4.4 million and revenue was up 16% to $121.7 million.

Sales into the UK and Europe are up 11% on last year with the McGuigan brand number four
in the UK market.

McGuigan Wines received six trophies, nine gold, five silver and eighteen bronze medals at the International Wine Challenge held in London.

The profit warning sent its shares down more than 6% to $0.375.

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.