Australian Vintage recorded a $93 million loss in the 2024 financial year, down from its $4 million profit the year prior.

The loss was a result of significant write-downs, including a $37.7 million goodwill impairment and a $36.6 million inventory write-down.

The company saw a one per cent increase in revenue to $260.6 million in the 12 months to June 30, with underlying earnings up 25 per cent to $13.2 million.

Were it not for the goodwill impairment and inventory write-down, the company’s net profit after tax would have grown by 26 per cent to $5.3 million.

The company, which came in at 57 in the 2023 South Australian Business Index, also announced the immediate resignation of acting CEO Peter Perrin following a cancer diagnosis.

Perrin had been in the position since May 2024 and will be replaced by James Williamson who has also taken on an interim Chair role.

It comes after a proposed merger with Australia’s second-largest wine business Accolade was terminated in May, with AVG notifying shareholders at the time that it “was not in a position to continue discussions”.

At that time, the company noted it expected its net debt for the financial year to blow out from a previously reported $43-50 million to $70-75 million. Net debt for the year has now been reported as $56.5 million.

Australian Vintage is headquartered at Cowandilla, and its portfolio includes the Barossa Valley Wine Company, Nepenthe, Tempus Two, McGuigan Wines and Passion Pop.

Australian revenue contributed $98.9 million in the financial year, second to the UK and Europe, which generated $126.3 million.

A board renewal during the financial year resulted in a strategy change to target free cash flow generation and an increased return, as the company aims for expansion into new markets.

Changes include a focus on reduced costs, which has already seen the company reduce its fixed grape supply.

AVG said it had been “actively working to increase the flexibility of its grape sourcing whilst removing assets that are not core to growth”.

“Through this strategy AVG were able to sell the Yaldara vineyard in May 2024 and terminate the lease to Balranald in July 2024,” the company said.

The removal of tariffs from China saw re-ordering in the market commence, as China’s largest food processor, manufacturer and trader COFCO renewed its partnership with AVG.

AVG said the rest of Asia had been “a challenging market for Australian exporters with inflationary pressures impacting discretionary spend”.

“Innovation is key to revenue and margin growth and is a core strength of AVG. Premiumisation and innovation now represent 26 per cent of revenue and 35 per cent of margin, a significant increase.”

Globally, the company reported a more than 20 per cent increase in revenue contribution from the no-and-low wine category.

AVG reported $213.6 million in net assets as of June 30 2024.