Key Notes – 12 February 2015

From The Key Report 12 February 2015
A new website – – has been launched in Chinese, encouraging visitors to Sydney and NSW. It lists about 150 travel experiences, including the odd mention for wine. Early days; let’s hope it grows.The UK chain of Aldi stores has been named wine retailer of the year at the Drinks Retailing Awards. The group goes from strength to strength in the UK, as it does in Australia.I’m sure it won’t be detrimental to the overall operation of Yalumba Wines, but it will seem strange when Rob Hill-Smith isn’t CEO. Rob is to become chairman, replacing Peter Barnes, who has held the chair for 12 years.Taking over from Rob as CEO will be Nick Waterman, who has been with the company since 2002. The question TKR has for both of them is: who do I pester for opinion/information, and if it’s Nick Waterman will he be as forthcoming as Rob has been over the years?Reports are so far indicating a good vintage in most parts of the country, though the Barossa is saying the shiraz crop could be down. As usual, reports are also circulating about the low price being offered for grapes. One has to wonder how much profit will be generated out of the billions of dollars of turnover from the 2015 vintage. One guesses not as much as should be, but the wailing will be long and loud.

According to Nielsen, the average price of a bottle of wine in the US during 2014 was US$9.41 ($12.06). Will it pass US$10 in 2015?

The National Australian Bank (NAB) forecast for 2015 contains this:

“Two trends are creating significant opportunities for SMEs (small and medium-sized enterprise). Tourists are becoming more interested in what they do than what they see, which means they’re searching for experiences. And more Chinese visitors are choosing to travel out of major cities into places such as the Gold Coast and far north Queensland, which is encouraging for regional businesses. The lower dollar could also encourage more Australians to holiday at home rather than overseas.”

Tourists going out to the regions will hopefully include visits to wine areas, and Australians holidaying at home will also be no bad thing for the wine industry, as they will spend money either via cellar door visits or dining in restaurants and buying wine.

New Zealand wine continues its upward journey, and therefore so do New Zealand wine companies. The Delegat Group has released its half-year sales figures:

  • Case sales: 1,129,000, an increase of 4 per cent on the corresponding period last year
  • Reported net profit after tax forecast to be NZ$9.8 million ($9.36 million)

The profit forecast is down from NZ$17.8 million last year due to fair value adjustments to the valuation of the group’s derivative instruments. The global case sales for the full year are forecast to be 2,205,000, up 9 per cent. How many Australian wine companies can report the same positive results?

Online retailer Virgin Wines is also doing well in the UK. Looking at its website, it appears to be doing so with prices that return a profit, the lowest Australian price being £7.99 ($15.60). The Australian range consists of 86 wines, most of which appear to be private brands. A recent report said the group recruited about 1000 new customers a day during December. Good going and hope for the future.

The state of Connecticut is considering imposing a sugar tax, or candy tax, as Americans call it. The aim is to combat obesity in children. Apparently, 12 per cent of Connecticut’s high school students are obese. Sugar tax is interesting, as it seems both right and wrong: right to tax a product that causes harm, but wrong to be so dictatorial. The same could be said of tax on wine.

TKR congratulations to Andreas Clark who has been acting CEO at the Australian Grape and Wine Authority (AGWA) for ages. He has now been permanently appointed to the role, effective immediately.

He’s a good bloke and TKR looks forward to working with him.

Be soothed with wine and love this coming week.


Acid drops Tapi Marlborough Sauvignon Blanc 2014: The good points include: It’s organic, it’s a Naked Wines crowdfunded wine, it’s extreme NZ sauvignon blanc and the majority will love it. It’s not a style for me. I don’t need to suffer that much when smelling and tasting a wine but being fair it’s a 92 point wine and fair value at $16.Plantagenet ‘Omrah’ Great Southern Sauvignon Blanc 2014: All the classic qualities of sauvignon blanc: the cut grass nose, crisp across the palate with the taste of gooseberry. I’m not a fan but a lot of people are and this is good. 93 points and worth its $19 but there is a lot of New Zealand wine out there at a cheaper price.Evans & Tate ‘Breathing Space’ Margaret River Sauvignon Blanc 2014: Not the often used cut grass, but (for me) herbal nose. I rather enjoyed it, slightly richer than many SB, it had some depth. 91 points and OK value at $19, although New Zealand SB lovers may think it pricey.Barking Mad Clare Valley Sauvignon Blanc 2014: Defined sauvignon blanc not overly aggressive on the palate and a touch richer than other SBs. It’s easy, does not offend but does not ring any bells either. 89 points and OK price at $16.

Flowstone Margaret River Sauvignon Blanc 2012: At last a SB that has some age to it. Having a slew of 2014 to taste it’s good to get one where the acid and fruit are in harmony. It stretches across the palate in an elegant fashion rather than hacking away as if in spiked boots. $32 is a lot to pay for SB but this is worth it at 94 points.