In a recent update to the Australian Securities Exchange (ASX), Australian Vintage Limited (ASX: AVG) has officially addressed recent media speculation surrounding a potential transaction with Accolade Wines.
The company confirmed that it is currently engaged in exploratory discussions with Accolade Wines, emphasizing that these talks are in the early stages. The official statement, released in response to ongoing speculation, referred to AVG’s Half Year results disclosed on 21 February 2024, where the company’s Strategic Review identified various initiatives aimed at maximizing shareholder value, including the possibility of transformational mergers.
“While AVG confirms exploratory discussions with Accolade, it is essential to note that these discussions are in their infancy, and there is no certainty that any transaction will materialize,” the statement clarified.
Accolade Wines, in response to inquiries about the speculation, maintained its stance of not commenting on such matters.
Speculation surrounding a potential transaction between Australian Vintage and Accolade Wines emerged following AVL’s half-year results announcement. The strategic review outlined initiatives to enhance shareholder value, particularly focusing on potential transformational mergers.
Despite challenging trading conditions, AVL’s half-year results showcased revenue in line with the 2023 financial year, along with improved margins and underlying earnings. Notably, in the Australian market, where the overall market experienced a five percent decline, Australian Vintage reported a two percent increase in market share across all segments.
AVG highlighted the growth of its super premium wines priced above $15, showing an impressive 11 percent year-on-year increase, while the total market saw a one percent decline. Branded products also contributed positively, with retail scan sales for Tempus Two up seven percent, Nepenthe up 20 percent, and Barossa Valley Wine Company up four percent compared to the previous year.
Despite heightened competition, Australian Vintage remains the leading no-and-low wine supplier in Australia, achieving a notable 15 percent growth versus the prior year.
In addition to the financial results, Australian Vintage announced the attainment of B Corp certification across its Australian operations and global pillar brands, further emphasizing its commitment to social and environmental responsibility.
