AUSTRALIA'S biggest wine exporter, Casella Wines, is looking at ways to raise prices across its highly successful Yellow Tail label as the high local dollar eats into its profit in its largest market, the United States.
Recent accounts lodged with the Australian Securities and Investments Commission show revenue at Casella, Australia's largest family-owned winery, fell 13 per cent in the 2011 financial year to $344.1 million as the high dollar hurt margins, The Australian Financial Review reports.
But successful currency hedging gave Casella a windfall and the group posted a $68.5 million foreign currency gain, up from $15.9 million the year before. The one-off win underpinned a near quadrupling of net profit to $45.3 million, from $12.3 million a year earlier.
Casella managing director John Casella said the winery's sales volumes had been in line with the previous year, but the Australian dollar had hurt revenue. The company sells about 12 million cases of wine a year, 8.5 million of them in the US.
The winemaker also significantly reduced costs in the 12 months to June 30 as it moved to combat the effects of a high dollar. Advertising and marketing costs, for example, fell by $10 million to $30.1 million.