Archive for February, 2009
Second biggest Australian wine group posts huge losses in half year results
Just when the wine community here in Australia was absorbing the latest news of the Foster’s Group restructuring its wine operations – the second largest wine producer Australian Vintage published a $128m first half loss last night. Australian Vintage, formerly known as McGuigan Simeon Wines, wrote down $175m in this first half year largely due to inventory write-downs.
Australian Vintage comprises amongst others McGuigan Wines with its name stemming from four generations of the McGuigan family and Miranda wines, which have been a family label for three generations, mainly sourcing their wines in the High Country in South East Australia’s high altitude regions.
High end labels were assorted in Nepenthe from the cool climate Adelaide Hills and Tempus Two as the ‘ultra premium brand’, a marketing term used by Australian Vintage still raising questions in me about how ‘ultra’ and ‘wine’ could make it together in marketing.
Finally we find new brands such as Passion Pop, launched in 2007 to deliver an Aussie Sparkling to Australia’s at that time happy, young and growing wine community. To tell you the truth: from a sales perspective, this is a complex and not really appealing mix, more of an assembled bunch of liquids than a real strategic fit for the sophisticated wine enthusiast.
And Australian Vintage struggles in these unfriendly conditions: first the wine glut, then the drought, the high Australian Dollar and now the global financial crisis leading into recession: this is not an economic climate to write home about.
The main difference to Foster’s is, that Australian Vintage doesn’t have the luxury of offsetting profits from beer or spirits divisions against the losses occurred with its wines. As much as the bad news from Australian Vintage might put a smile on the faces of competitor’s Foster’s management, as much they now should be worried too: the Foster’s Group will keep its wine business in its protfolio for much longer as it will be even harder to sell this asset (or is it a liability?) in the near future – there is no doubt about that.
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Die nach Groesse an zweiter Stelle liegende, boersennotierte Australian Vintage vermeldet in ihrem Halbjahresbericht einen Verlust von umgerechnet 85 Millionen EURO. Im wesentlichen stammen diese Verluste aus den Abschreibungen des Inventars, viele der Weine des Hauses sind einfach in der Form und zu diesen Preisen nicht an den Weintrinker zu bringen.
Ihr Michael Brecht
The NSW wine week starts in Sydney on the 1st of March 2009
NSW Wine jointly with the Sydney Morning Herald will present the second annual NSW Wine Week, starting Sunday the 1st of March until 7th of March. After last year’s success, the city prepares again for the celebration which aims to promote the diversity of the NSW Wine regions. The organisers promise that “this wine festival, not to be missed, will be the biggest outdoor wine event ever staged in Sydney”.
More than 100 wineries from the famous Hunter Valley, the cool climate Southern Highlands and Canberra District, wineries from Orange, Hilltops, Mudgee and the Riverina will be there – just to name a few: a total of 14 regions from NSW will be present.
Many of the events are outdoors: on Sunday the 1st of March the Hyde Park South becomes a wine tasting area between 11am and 6pm. Additionally Sydney will host four unique dinner experiences in four of Sydney’s leading restaurants including Glass Brasserie, Buon Ricordo, Becasse and Bentley Restaurant & Bar.
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Vom 1.-7. Maerz findet in Sydney zum zweiten Mal die NSW Wine Week statt, es verspricht in diesem Jahr die groesste Veranstaltung im Rahmen von Wein in Sydney zu werden, die es je gab. Mehr als 100 Wineries aus 14 Regionen aus NSW werden an dieser Woche teilnehmen, vom Hunter Valley ueber die cool climate Gegenden Canberra District und Southern Highlands, bis hin zu den Wineries aus Mudgee, Riverina oder Orange.
Sollten Sie in Sydney oder NSW weilen, so schauen Sie doch vorbei. Allein am Sonntag, den 1. Maerz werden mehrere Tausend Weintrinker im Hyde Park erwartet, um dort die vielen Weine zu verkosten.
Ihr Michael Brecht
No news on which Foster’s wine brands will be chopped – yet
Last week’s announcement of Australian bewerage giant to keep the wine business but separate it from its beer and spirits sections was the big news for anybody involved in wine making here down under.
Going seperate ways: Foster's beer and wine
Foster’s announced that they would get rid of 37 brands. Its portfolio includes brands such as Penfolds, Beringer, Lindemans, Wolf Blass, Rosemount, Matua Valley, Wynns Coonawarrra Estate and Castello di Gabbiano. There is huge speculation on where Foster’s will start to chop, it is for sure though, that they will aim to better follow current trends in the Australian wine market: more variety and less heavy Reds. Let’s wait and see.
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Die Foster’s Gruppe laesst sich Zeit: in der vergangenen Woche wurden massive Umbaumassnahmen angekuendigt, allein welche Marken der Konzern zukuenftig aus dem Programm streicht ist noch nicht bekannt. Wir werden sie umgehend informieren, sobald wir Naeheres wissen.
Ihr Michael Brecht
Charity Dinner in the Geelong wine region
We have seen many reports about the bushfires here down under that devastated large areas of rural Victoria in the past weeks. Many wine regions between Bendigo in the West and the Yarra Valley in the East are affected. With most fires now under control, the residents and business of these areas begin to rebuild their lives.
And it is amazing, how Australians stood up to help their fellow countrymen, millions raised throughout the country in spontaneous help. Here in the Southern Highlands I hardly know any shop, that hasn’t got a white container at its cash register collecting money for bushfire victims. There is also a large number of fund raising events in wineries and restaurants, raising much needed funds for the Red Cross Bush Fire Appeal.
I received an invitation today to join a fund-raising dinner in the Geelong region, a few kilometers west of Melbourne. On Friday 6 March there will be a charity dinner at Bellarine Estates’ Julian’s restaurant from 6.30pm for a cost of $70 for a 4 course meal, and drinks at bar prices.
To everyone reading this blog and either living or traveling in the Geelong area, this is your chance to help. Staff and Suppliers have donated their time and food so all proceeds will be donated to the Red Cross Bush Fire Appeal – good on you.
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Nachdem die meisten Braende unter Kontrolle sind, beginnt fuer die Menschen in den Brandgebieten Viktoria’s der Wiederaufbau ihrer Existenz. Unzaehlige Sammlungen haben in den vergangenen Tagen Millionen von Dollars fuer die Betroffenen zusammen gebracht. Ich erhielt heute eine Einladung zu einem Charity Dinner in der Geelong Gegend. In dem renommierten Bellarine Estates’ Julian’s restaurant koennen Sie lokale Weine und vorzuegliches Essen geniessen, die gesamten Einnahmen gehen an das Rote Kreuz. Melden Sie sich an, wenn Sie in der Naehe sind, und helfen Sie den Betroffenen in den Brandgebieten.
‘Good on you’ sagen wir hier in Australien zu Initiativen wie dieser.
Ihr Michael Brecht
Why is Australia so suitable for growing Grenache? Interview with Fred Howard
On a recent post I described how astonished I was when I discovered Australian Grenache. McLarenVale is currently working hard to make Grenache ‘its grape’. I spoke to Fred Howard, winemaker and co-owner of DogRidge Winery in the Vale about this variety.
Fred Howard from DogRidge with Michael Brecht
downunderwines: Thanks Fred for your time. So tell us, how did the Grenache vine find its way here to South Australia?
Fred Howard (FH): Originally South Australia produced lots of fortified wines, which were sent back to England mainly for medical purposes. Grenache quickly became a favourite variety as it was growing so strong, it didn’t need a lot of work and you got lots of grapes out of the vines. Additionally the grapes contained very high sugar levels and were drought resistant, by nature.
DogRidge Cadenzia Grenache 2005
downunderwines: So these Grenache wines made it into the fortified wines helping doctors cure in the UK, but comes that it is today one of the finest variety here in the McLaren Vale?
FH: To tell you the truth: we have been working hard, to make our Grenache what it is today. The growth of the wines means that you have to prune heavily, it is almost as if you are manipulating the growth of the vines. The lack of water naturally helps as the growth slows down. Also we cut the tips so that the energy stops within the leaves, I guess all in all our crop thinning results in only getting 50% of the berries.
downunderwines: And these 50% are magic, almost comparable to the dead arm treatment, that D’Arenberg is so famous for?
FH: yes exactly. While thinning the crop to such an extent, we achieve results of berries that are simply wonderful to work with, once they are coming into the winery. Our Grenache vines have been planted in the 1940s, the character and complexity of its fruit is simply stunning.
I have then tried a few of DogRidge’s Grenache wines, now marketed under the Cadenzia label. Both the 2005 and 2006 are 100% Grenache, displaying a highly juicy sweet-fruit palate and the flavours were absolutely stunning. I preferred the 2005 as it had this extra year in the bottle which made it sensational. These wines a great for cellaring, give it a few years and drink it on a cold winter night, in front of a fire, sounds like heaven to me.
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Meine juengste Reise nach McLaren Vale brachte mich mit Fred Howard zusammen, der gemeinsam mit seinem Bruder David die DogRidge Winery sein eigen nennt. Hier werden seit vielen Jahrzehnten die klassischen Shiraz und Cab Savs angebaut, seit mehr als 65 Jahren wachsen zusaetzlich Grenache Trauben heran. Hiervon handelt mein Interview mt Fred, das McLaren Vale arbeitet derzeit sehr daran, diese Grenache Traube zu ‘ihrem’ Markenzeichen zu machen.
Gemeinsam mit Fred habe ich dann die Jahrgaenge 2005 und 2006 getestet, das Ergebnis: grossartig – ich bin ein Grenache Fan – allerdings nicht Fan der spanischen sondern ausschliesslich der australischen Variante.
Ihr Michael Brecht
Fosters: restructure, breakup and sell-off to help shareholder value – but is this enough?
Facts first: the Australian beer and wine giant has today announced to retain its wine business. Since evaluating its options with the departure of its former CEO Trevor Hoy last year, the business community was speculating whether or not the wine business could be history in Fosters liquor empire.
Instead of sealing its fate, the Fosters Group today announced major changes to their wine business itself:
- 36 ‘non-core’ vineyards will be sold,
- 37 Fosters owned ‘tail’ brands will be sold or discontinued,
- 3 wineries in Australia and California will either be closed, reconfigured or consolidated, and
- the Group expects to book total asset writedowns and restructuring charges between $330 million and $415 million in the second half of this 2008/09 financial year.
So let us look behind the scenes and explain why they are doing it:
Firstly the decision to keep the wine business was heavily influenced by external factors: “The current difficult conditions in debt and equity markets mean this is not the appropriate time to sell or de-merge Foster’s Wine business,” Fosters Chairman Crawford said today in his address to the media. Point taken, it doesn’t help presenting your wine business to potential buyers in an economic climate like ours today. So the Fosters management didn’t have a real chance and now has to make the best out of it.
Secondly: Foster’s management seems to understand the signs of the times, let me give you some examples:
I am a former (tiny) shareholder in Fosters and I still receive their newsletters in print to my post office box, although I told them in several of their frequent sales calls that they should better take me of their list. But hey: this is fun – as it gives me exposure to some of the best trained telephone sales people the wine industry has on offer.
But then I open the mail and I am confused: so many brands, so much Shiraz and Cabernet, but so little variety: I have in the past simply questioned Fosters capacity to market what today’s wine drinkers really like, its management still living in an Australian wine climate of 10 years ago. The reshaping of its brands will change this.
Another major lesson learned is the fact that wine and beer just don’t sell well together: the multi beverage model Fosters was pursuing never worked and now is officially called dead. Its Australian wine and its beer, cider and spirits divisions will be structurally separated. I still smile at the idea of having a Fosters/Southcorp sales rep try to convince the average retailer in Wagga to buy one of their 47 wine brands, while the consumer was mainly connecting the Fosters brand with beer.
So there is good news and bad news in today’s announcement for the 7,000 other Australian winemakers: the bad news is that Fosters management has woken up and will stick to its portfolio – they have the deep pockets to finance this change and profits from its beer and spirit business will help turn around their wine story. The only good news in this is that it will take some time for the giant to make it happen.
Valuable time I will take and open another bottle from one of the many fine smaller Boutique wineries here in Australia.
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Die Fosters Gruppe hat heute einschneidende Veraenderungen fuer ihre Struktur beschlossen. Nachdem in den letzten Monaten so ziemlich jede strategische Variante fuer oder gegen den Verbleib der Weinsparte im Konzern diskutiert wurde, hat heute Chairman Crawford verkuendet, dass die Weinsparte an Bord bleibt. Basta!
Allerdings werden innerhalb der Weinsparte massive Veraenderungen vollzogen:
- 36 Weinberge werden verkauft
- 37 Marken im Rahmen der Fosters/Southcorp Weine werden abgegeben
- 3 Wineries in Australien und Kalifornien werden geschlossen oder konsolidiert
Das Ganze fuehrt zu Umstrukturierungskosten in Hoehe von 330-415 Million AUD.
Wir werden diese Vorgaenge in den naechsten Tagen weiter analysieren und Sie auf dem Laufenden halten.
Ihr Michael Brecht
Entry Chardonnay from Tilbrook scores well on a Monday night
Monday night is the night for trying wines well under $20 – this time a 2006 Chardonnay from Tilbrook Estate. I met James Tilbrook at his cellar door a few weeks ago and he made me taste this one in particular.
Selection of Tilbrook Estate Wines at the cellar door
Not that I didn’t want to taste the high end releases, but I think it is important for any winemaker to look after those purchasers, that buy wine for a Monday night – nothing special, accompanying food and still never disappointing.
The 2006 Chardonnay (retailing for $15) has 15% Sauvignon Blanc grapes in it, melon and stonefruit make it a typical Chardonnay from a cool climate region. The wine displays this fresh taste with a good length, with 13.5% alcohol it is a Chardonnay on the lighter side – just right for our Monday night.
You have to be quick though, as Tilbrook Estate produces only small quantities of his wines, last year the total production was only for 1500 cases.
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James Tilbrook produziert Jahr fuer Jahr Spitzenweine in seinem kleinen Weingut in Lobethal, keine 40 Minuten von Adelaide entfernt in South Australia gelegen. Ich trinke heute abend einen Chardonnay aus dem Jahr 2006, bewusst die Einstiegsvariante, denn Montags teste ich gerne die einfacheren Versionen der einzelnen Wineries. Fruchtig frisch, mit 15% Sauvignon Blanc Trauben angereichert ist der 2006 Tilbrook Chardonnay ein angenehmer Tropfen.
Ihr Michael Brecht
Pinot Gris or Grigio – a real Shooting Star here in Australia and New Zealand
Whenever I stand in front of a fridge in a bottle shop here in Australia, my eyes become overwhelmed with the many logos, different wine names and last but not least the question: which wine matches the food, we are having tonight. It happened to me again today as I was visiting Will, a wine expert in one of the bottle shops here in the Southern Highlands.
Pinot Gris and Pinot Grigio - spot the difference
We started talking about the sales during the heat wave of the last weeks and he surprised me with the fact that Pinot Gris and Grigio were really on the rise here downunder. Let us think back: in 2003 a mere 329 hectares of Pinot Gris were planted in Australia representing 0.5% of all white grapes planted here. This number has changed substantially with 2,469 hectares (following 2008 Directory) planted as Pinot Gris – an increase of 650% since 2003, representing 3.4% of all white varieties planted in Australia.
Now where is the difference between Gris and Grigio: both terms mean ‘grey’: Gris is the french word and stems from the Alsace region in north-east France, Grigio is the name of the same grape originally from Italy. Australian wineries have adopted both terms in the past years, there is no true consistency to who uses it – I suspect a bit of a rivalry originating in French or Italian heritage of the winemaker or owner of the vineyard. I have to ask Sandro Mosele from the Mornington Peninsula about this actually, he is from an Italian family with nine brothers and sisters.
And where do the best Pinot Gris and Grigio come from: in New Zealand the Marlborough region produces outstanding ones, here in Australia the cool climate regions such as the Mornington Peninsula, Tasmania, Adelaide Hills, the Southern Highlands and the Canberra region all bring out some great white Pinots.
On my way to dinner now, we’ll try a Pinots Gris from the Canberra region with our chicken tonight, I’ll keep you posted.
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Pinot Gris und Grigio haben sich in den vergangenen Jahren hier in Australien enorm entwickelt. Die Anbaumenge hat sich zwischen 2004 und 2008 mehr als versechsfacht, heute sind 3.5% aller australischen Weissweine entweder Pinot Gris oder Grigio. Fuer die Verwendung des Namens gibt es keine Regel, die offiziellen Statistiken fuehren jedoch die Traube als Pinot Gris.
Wir werden heute abend einen Pinot Gris aus der Canberra Region zu unserem Huhn verkosten, ein Testbericht dazu folgt bald.
Ihr Michael Brecht
