Details soon:If Johnson can turn around this one he will be the...

Details soon:

If Johnson can turn around this one he will be the toast of the wine industry - enormous returns for new investors in recent months.

Winemaker Evans & Tate Limited (ETW) last night announced a loss of $63.9 million for the 2005/06 financial year, down 12% on the corresponding figure for the previous year. Chief executive officer Martin Johnson said 2005-06 had been a tough year and the loss was painful for all stakeholders.

Mr Johnson said the Evans & Tate board of directors had approved in principle a plan to restructure its balance sheet. He said work on the proposed restructure was in its initial stages and it was far too early to release final details.

He said that the 2005-06 result was attributable to a number of factors including tough trading conditions in the United Kingdom market, the wine market glut in Australia coupled with increased competition and restructuring costs associated with the Evans & Tate turnaround strategy.

“All of the pain caused by the challenges in the marketplace provided the impetus to reinvent our business to an extent that may not have been possible under less traumatic conditions,” Mr Johnson said in a press statement.

“The turnaround strategy embarked on 12 months ago is already yielding significant results and laying the platform for a sustainable future.

“We now have the team, the plan and the products to drive profitable sales in the years to come.”

Mr Johnson said the company’s wholly owned distribution business, WineSource, was an ongoing strength of the company which would be further strengthened in 2006/07 with the addition of a number of new agency brands.

He said that since the end of the 2005-06 year, Evans & Tate had completed the sale of its Mildura and Griffith wineries with proceeds of about $30 million, of which $25.2 million went to repaying debt.

Evans & Tate had also launched a new stand-alone brand and several new premium wines from the Margaret River range with more to follow in coming weeks, he added.

“2006-07 will see the company very focused on its core brands and its mission as a producer and distributor of premium quality wines,” Mr Johnson said.

Evans & Tate said it would not pay a final dividend on either its ordinary or preference shares.

Mr Johnson said that despite the gloom of 2005-06, the turnaround of Evans & Tate started to show some positive results in the final two months of the year.

He said there were clear indications that the Evans & Tate strategy to focus its future direction on its ultra-premium wines and brands from the Margaret River region was the best way forward for the company.

http://www.egoli.com.au/egoli/egoliNewsViewsPage.asp?PageID={C30B8CFF-0A4C-4E5F-90FE-C9AF013B748C}