A day after announcing a quarterly loss of $2,901,000, Wine Planet released forecasts up to the year 2004, when it expects to achieve sales of $152 million against a rather thin level of earnings before interest, tax and depreciation of just $9.75 million. Seems like it costs a lot of money to sell wine over the Internet. Cashflow figures for the last quarter show sales of $3,583,000 against staff costs of $1,132,000, marketing expenditure of $443,000 and ‘working capital’ costs of $5,110,000. For the nine months to March 31, receipts totalled $10,204,000 with a net operating cashflow of minus $5,371,000. Wine Planet’s share price has plummeted by 68% from its 54 cent level in February to just 17.5 cents. Against these results, Foster’s Brewing’s chief executive Ted Kunkel has said that the company, which owns 25% of Wine Planet, will continue to focus on branding, improving margins and rate of return. I expect that there is no shortage of focus at the present time. Foster’s is also presently talking with two or three international companies over possible asset acquisitions in wine and beer, ruling out any such purchases in Australia and Asia or the UK’s Bass Brewing. The world’s largest internet wine auction house, winebid.com, has opened an office in Sydney and will conduct live auctions in Australia twice a month, running for two weeks at a time. It claims to offer to collectors worldwide a ‘truly global network to sell and acquire the world’s best wines’. Needless to say, Langton’s, the market leader in the Australian secondary wine market, are working feverishly to enter the online auction market as soon as possible. Wine writer James Halliday, who having sold Coldstream Hills to Southcorp in 1996 before becoming Group Regional Winemaker to the company, has resigned this position to direct most of his considerable energies towards the development of the Winepros website. He has not severed his commercial ties with Southcorp, however, and will remain a consultant to Coldstream Hills. As a key component of its intentions to expand into other markets, Winepros has invested $US2.5 million to form an alliance with WineBuyer.com Inc, which claims to be the premier provider of e-business services for the wine and spirits industry. WineBuyer.com is the first internet-based information and transaction service designed to link licensed buyers and sellers of wines and spirits over the internet. It recently bought Beverage Data Network, the leading provider of data management and information services to the US wine and spirits industry. WineBuyer.com has an integrated online transaction network for the US market, through which Winepros cain gain access to a range of state-based US retailers to fulfil orders from its US customers. Winepros will purchase 838,926 Series B Preferred Stock in unlisted Winebuyer.com at $US2.98 per share, representing an investment of $AUD 4.2M ($US2.5M). Winepros chairman Bruce Kemp will become a member of the Winebuyer.com board of directors. Winepros is one of the wine internet sites which has purchased the ability to host online Jancis Robinson’s latest Oxford Companion to Wine.
