Willamette Valley Vineyards Posts results for Q2 2022

Rhea-AI Summary

Willamette Valley Vineyards (NASDAQ: WVVI) reported a loss per share of $0.04 for Q2 2022, compared to a profit of $0.14 in Q2 2021, marking a $0.18 decline. Sales revenue decreased by 2.8% to $8.7 million, primarily due to a $929,661 drop in distributor sales, partially offset by a $680,571 increase in direct sales. Gross profit fell by 6.1% to $4.8 million. Administrative expenses surged 21.7% to $4.4 million, leading to a net income drop of 76.1% to $257,401.

Positive

• Increased direct sales by $680,571 due to retail growth.
• Expansion plans with three new locations expected to enhance future profitability.

Negative

• Loss per share of $0.04 in Q2 2022 compared to a profit of $0.14 in Q2 2021.
• Sales revenue declined by 2.8%, attributed to lower distributor sales.
• Gross profit decreased by $312,466, or 6.1%.
• Administrative expenses rose by 21.7%, impacting overall profit margins.

SALEM, Ore., Aug. 11, 2022 /PRNewswire/ -- Willamette Valley Vineyards, Inc. (NASDAQ: WVVI) (the "Company"), a leading Oregon producer of Pinot Noir, generated a loss per common share after preferred dividends of $0.04 and a profit per common share after preferred dividends of $0.14 for the three months ended June 30, 2022 and 2021, respectively, a decrease of $0.18, for the three months ended June 30, 2022 over the prior year period.

Sales revenue for the three months ended June 30, 2022 and 2021 was $8,700,861 and $8,949,951, respectively, a decrease of $249,090, or 2.8%, in the current year three-month period over the same prior year period. This decrease was caused by a decrease in sales through distributors of $929,661 being partially offset by an increase in direct sales of $680,571 in the current year three-month period over the same prior year period. The decrease in revenue from sales through distributors was primarily attributed to later availability of new vintage wines compared to the prior year period. The increase in direct sales to consumers was primarily the result of retail sales increases in tasting room revenue. 

Gross profit for the three months ended June 30, 2022 and 2021 was $4,827,257 and $5,139,723, respectively, a decrease of $312,466, or 6.1%, in the current year three-month period over the same prior year period.

Selling, general and administrative expense for the three months ended June 30, 2022 and 2021 was $4,382,814 and $3,602,129 respectively, an increase of $780,685, or 21.7%, in the current year three-month period over the same prior year period. 

Net income for the three months ended June 30, 2022 and 2021 was $257,401 and $1,077,551, respectively, a decrease of $820,150, or 76.1%, in the current year three-month period over the same prior year period. 

Jim Bernau, Founder and CEO of the winery said "Inventory delays at the start of the year have negatively impacted our sales through distributors in the first six months of the year.  We have also incurred additional planned expenses in the first half of the year in connection with our planned opening of three new locations later this year. While we expect higher supply costs and labor shortages to reduce margins and earnings in the near term, our growth initiatives are designed to produce greater profitability in the long term."

For a complete discussion of the Company's financial condition and operating results for the first quarter, see our Form 10-Q for the six months ended June 30, 2022, as filed with the United States Securities and Exchange Commission on EDGAR. 

Willamette Valley Vineyards, Inc. is headquartered at its Estate Vineyard near Salem, Oregon.  The Company's common stock is traded on NASDAQ (WVVI). 

Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties that are based on current expectations, estimates and projections about the Company's business, and beliefs and assumptions made by management.  Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "predicts," "potential," "should," or "will" or the negative thereof and variations of such words and similar expressions are intended to identify such forward-looking statements.  Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including, but not limited to:  availability of financing for growth, availability of adequate supply of high quality grapes, successful performance of internal operations, impact of competition, changes in wine broker or distributor relations or performance, impact of possible adverse weather conditions, impact of reduction in grape quality or supply due to disease or smoke from forest fires, changes in consumer spending, the reduction in consumer demand for premium wines, the impact of supply chain and transportation disruptions,  and the impact of the COVID-19 pandemic and the policies of United States federal, state and local governments in response to such pandemic. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic economic conditions.  Many of these risks as well as other risks that may have a material adverse impact on our operations and business, are identified in Item 1A "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2021, as well as in the Company's other Securities and Exchange Commission filings and reports.

The following is the Company's Statement of Income for the three months and six months ended June 30, 2022 compared to the three and six months ended June 30, 2021:

 

 

					Three months ended				Six months ended
					June 30,				June 30,
					2022		2021		2022		2021
SALES, NET					$       8,700,861		$       8,949,951		$     14,943,179		$     14,715,289
COST OF SALES					3,873,604		3,810,228		6,395,893		6,081,999
GROSS PROFIT					4,827,257		5,139,723		8,547,286		8,633,290
OPERATING EXPENSES
	Sales and marketing				3,019,613		2,235,124		5,497,340		4,351,789
	General and administrative				1,363,201		1,367,005		2,741,735		2,567,898
		Total operating expenses			4,382,814		3,602,129		8,239,075		6,919,687
INCOME FROM OPERATIONS					444,443		1,537,594		308,211		1,713,603
OTHER INCOME (EXPENSE)
	Interest income				904		3,081		3,293		6,478
	Interest expense				(90,371)		(97,499)		(181,817)		(197,075)
	Other income (expense), net				(355)		40,679		88,669		129,813
INCOME BEFORE INCOME TAXES					354,621		1,483,855		218,356		1,652,819
INCOME TAX PROVISION					(97,220)		(406,304)		(59,897)		(452,583)
NET INCOME					257,401		1,077,551		158,459		1,200,236
Accrued preferred stock dividends					(466,613)		(362,506)		(933,225)		(722,142)
NET INCOME (LOSS) APPLICABLE TO COMMON SHAREHOLDERS					$        (209,212)		$           715,045		$        (774,766)		$           478,094
Earnings (loss) per common share after preferred dividends,
	basic and diluted				$               (0.04)		$                  0.14		$               (0.16)		$                  0.10
Weighted-average number of
	common shares outstanding				4,964,529		4,964,529		4,964,529		4,964,529

 

 

View original content to download multimedia:https://www.prnewswire.com/news-releases/willamette-valley-vineyards-posts-results-for-q2-2022-301604730.html

SOURCE Willamette Valley Vineyards

FAQ

What was Willamette Valley Vineyards' earnings per share for Q2 2022?

Willamette Valley Vineyards reported a loss per share of $0.04 for Q2 2022.

How much did sales revenue decrease for Willamette Valley Vineyards in Q2 2022?

Sales revenue decreased by 2.8%, totaling $8.7 million in Q2 2022.

What caused the drop in net income for Willamette Valley Vineyards in Q2 2022?

Net income dropped by 76.1% to $257,401 due to increased administrative expenses and lower gross profit.

What were the main factors affecting Willamette Valley Vineyards' distributor sales?

Distributor sales decreased due to inventory delays and later availability of new vintage wines.