Foley Wines (FWL) H2 2024 earnings summary

Executive summary

• Revenue was stable at $66.4m, but profit after tax fell to a $4.1m loss, impacted by a one-off $4.5m deferred tax expense and challenging market conditions.

• Operating EBITDA declined 20% to $16.2m, reflecting higher marketing, interest, and insurance costs.

• Case sales were down 4% year-over-year, outperforming the broader NZ packaged wine market, which declined 21%.

• Significant investment in the US market led to a 60% increase in US case shipments.

• No final dividend declared; focus is on debt reduction amid subdued trading conditions.

Financial highlights

• Total revenue: $66.4m (flat year-over-year).

• Operating profit before revaluations and tax: $4.1m (down 60%).

• Net loss after tax: $(4.1)m (down from $6.3m profit), driven by a one-off deferred tax expense.

• Operating EBITDA: $16.2m (down 20%).

• Basic EPS: (6.21)c vs. 9.65c last year.

• Operating cash flow: $4.3m (down from $10.3m).

Outlook and guidance

• Trading conditions remain subdued domestically and globally, with ongoing oversupply and high costs.

• Company expects to sell through the 2024 vintage in a timely manner and anticipates improved conditions by FY26, assuming a normal 2025 vintage.

• Capital expenditure for FY25 is budgeted at $3.5m, focused on vineyard redevelopment.