Napa Valley maker of Duckhorn and Decoy wines reports Q3 earnings up 7%
The Napa Valley-based producer of the Duckhorn Vineyards and Decoy wine brands, on Thursday reported quarterly earnings were up 7.6% from a year before but sales for the quarter were down slightly.
The Duckhorn Portfolio (NYSE: NAPA) reported net income for its fiscal third quarter, ended April 30, was $16.8 million, or 15 cents per diluted share. Adjusted proforma earnings were $35.8 million, up 9% over 12 months.
Quarterly net sales were $91.2 million, down 0.4% from a year before. Meanwhile, the volume of wine shipped in the quarter was up 3.5% in that time frame.
That was because of a previously announced shift in the releases of the Kosta Browne Appellation Series wines, the largest-volume offering to date for the brand, to the fiscal fourth quarter and the Kosta Browne’s higher-end Estate Series wines to the third quarter, outgoing Chief Financial Officer Lori Beaudoin explained on the investor webcast about the results.
“Absent these timing shifts, we would have seen low-double-digit net sales growth overall for the quarter, which speaks to the health of our business,” Beaudoin said. Direct-to-consumer sales were down 35.2% from a year before. “Tasting rooms were a bright spot, growing nicely on a net-sales basis, despite unfavorable weather throughout the quarter.”
She noted that the company’s wholesale-to-distributor sales channel returned to growth in the third quarter, up 10.3% year over year.
The company revised upward its forecast for the full fiscal year, ended July 31: net sales of $400 million–$404 million and adjusted earnings before interest, taxes depreciation and amortization of $138 million–$140 million.
“Given our consistent out-performance year-to-date and confidence in sustained momentum for the balance of the year, we are pleased to again be upwardly revising our Fiscal 2023 guidance,” said Alex Ryan, president, CEO and chairman, in the announcement of financial results.
Beaudoin’s replacement as CFO and executive vice president, effective June 19, is set to be Jennifer Fall Jung, the company announced May 23. Beaudoin, scheduled to retire June 16, has been Duckhorn’s finance chief for 14 years. Fall Jung has over a quarter century of experience in corporate finance, including 21 years at Gap and the last few as CFO for consumer products company Funko, according to Duckhorn.
Duckhorn’s quarterly results were released after the close of stock trading Thursday. In the first hour of Friday’s session, the share price fell to $13.60 then shot up to $14.01 before ending the day at $13.99, up 16 cents (1.2%) from Thursday.
Jeff Quackenbush covers wine, construction and real estate. Reach him at jquackenbush@busjrnl.com or 707-521-4256.
