Scheid Vineyards provides 6-month update
Winery’s 2nd quarter revenue up compared with previous time period
Scheid Vineyards Inc., Salinas, Calif., announced its financial results for the six months 2020 fiscal period, which ended Aug. 31.
Revenues for the 2nd quarter of fiscal 2020 increased to $18.7 million, from $16.7 million for the same period in the 2nd quarter of fiscal 2019. Revenues for the period were offset by cost of sales of $15.1 million; sales and marketing expenses of $4.9 million; general and administrative expenses of $4.2 million; and interest expense of $2.4 million. Revenues for the 2nd quarter of Fiscal 2019 were offset by cost of sales of $13.9 million; sales and marketing expenses of $4 million; general and administrative expenses of $5 million; and interest expense of $2.1 million. After adjustments for income taxes, the net loss for 2nd quarter of fiscal 2020 was $5.7 million as compared with $6 million in the 1st quarter of fiscal 2019.
Mike Thomsen, chief financial officer of Scheid Vineyards, stated: "During the second quarter of fiscal 2020, our cased goods sales accelerated from the first quarter. Cased goods revenues for the six months ended Aug. 31, 2019, finished up 21 percent over the same period last fiscal year. On the other hand, bulk wine sales decreased by 35 percent from the previous years' period, as demand for bulk wine continues to be weak throughout the entire wine industry. This has led to a decrease in overall margins.
"In addition, the bulk wine and grape business is seasonal, and a significant portion of grape crop sales revenue comes at the time of the annual harvest in September and October,” he continued. “Contracted bulk wine sales take place primarily in the fourth quarter of each fiscal year. The company continues to expand its sales and marketing divisions resulting in an increase in those costs from the previous year, which were partially offset by a decrease in spending on general and administrative expenses."
Scott Scheid, president and chief executive officer of the company, also provided an update on the 2019 harvest. "Our annual grape harvest began in late August, and it is anticipated that we will complete this years' harvest in early November,” he says. “This timing is normal for wine grape vineyards on the Central Coast of California. We are currently just over two-thirds completed with harvest and yields appear to be trending below average levels for most varieties."