Ste. Michelle Posts Sales Down 3.3%, Takes Write-Off On Inventory, Grape PurchasesApril 30, 2020
Ste. Michelle Wine Estates saw sales decline 3.3% to $146 million in its fiscal first quarter ended in March, as on-premise restrictions due to the Covid-19 crisis cut into the business. Volume was down 10.2% to 1.7 million cases, and adjusted operating income fell 13.3% to $13 million.
Additionally, parent company Altria recorded pre-tax charges of $392 million on Ste. Michelle’s operations, including $292 million for a wine inventory write-off and $100 million for estimated losses on future non-cancellable grape purchases that Ste. Michelle believes no longer have a future economic benefit. The company says it has “implemented a strategic reset in order to maximize its profitability and achieve improved long-term cash flow generation.”—Daniel MarstellerSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.
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