The New Zealand Wine Company

December 2007 Half Yearly Report

The New Zealand Wine Company announces an unaudited net profit after tax for the December 2007 half year under NZ IFRS of $1,029,000 – an increase of 180% on the prior 2006 half year of $368,000. Under the previous NZ GAAP the comparative unaudited net profit after tax for the December 2007 half year would have been $676,000 – an increase of 46% on the prior 2006 half year of $462,000.
 
The financial statements have been prepared under the NZ IFRS financial reporting standards for the first time and there are some significant variations when compared to earnings reported under the previous NZ GAAP. Comparative summary financial tables have been prepared in the Half Year Report to highlight the NZ IFRS variations. The most significant variation to the previous NZ GAAP impacting positively on reported NZ IFRS earnings is an unrealised pre tax foreign exchange gain of $459,000, related to the valuation of forward exchange contracts at “fair value” as at 31 December 2007.
 
Total revenue reported for the half year was $5.601 million – an increase of 5% on the prior 2006 year $5.335 million.
 
Chairman Alton Jamieson said that:
 
The continued strength of the New Zealand Dollar has damaged many New Zealand exporters and our company is no different.” “The continued strength of the NZD against the currencies of our key export markets is currently projected to negatively impact on earnings in the second half and the Directors expect the net underlying earnings for the full June 2008 to increase by up to 5% over the June 2007 year.”  
 
“The continued strength of the New Zealand Dollar when coupled with the currently expected market prices of grapes for the forthcoming harvest in Marlborough means the company is having to progressively implement price increases in its export markets.”
 
 “Sales volumes have been on target with the growth strategy implemented by the Company in recent years and our carboNZero® certification has assisted the company to secure new wine listings in its major export markets.”
 
A fully imputed interim dividend of 3 cents per share for the half year will be paid to shareholders on 4 April 2008.
 
A full copy of the Half Yearly Report for the six months ended 31 December 2007 and the Directors’ Report with comparative summary financial tables and explanatory notes is available on the NZWC web site, at: http://www.nzwineco.co.nz/financial.aspx.
 
Authorised for public release.
 
For further information please contact:
 
Alton Jamieson
Chairman, The New Zealand Wine Company Limited
PO Box 67, Renwick, Marlborough
Tel: +64 21 964 995
 
Or
 
Rob White
CEO, The New Zealand Wine Company Limited
PO Box 67, Renwick, Marlborough
Tel: +64 3 572 8200