Vina Concha y Toro Reports Second Quarter and First Half 2009 Results

SANTIAGO, Chile, Aug. 12 /PRNewswire-FirstCall/ -- Vina Concha y Toro S.A. (NYSE: VCO), Chile's largest producer and exporter of premium wines, reports results for the second quarter and first half 2009, ended June 30.

-- Net income for the quarter increased 11.3% to Ch$ 12,989 million (US$ 24.4 million), compared with Ch$ 11,668 million (US$ 21.9 million) in the second quarter of 2008. Earnings per ADR increased 10.3% to US$ 0.66 for the quarter.

-- For the quarter, total revenues increased 19.3% to Ch$ 94,439 million (US$ 178 million). Growth was primarily driven by greater sales in export markets.

-- Company CEO Eduardo Guilisasti said, "Company results in this period were highly satisfactory due to the favorable sales growth in the principal markets at a time when consumption in general has suffered a substantial contraction. Export sales in the quarter rose 18.8%, driven by an 11.3% increase in volume (Export sales rose 16.6% by value and 10% by volume in the first half). Notable was the growth seen in the markets of the United States, United Kingdom, Japan and Canada, demonstrating the strength of our brand delivering an excellent value proposition."

-- Domestic market sales increased 4.5% in the quarter, following a 5.3% increase in volume, partly offset by a 0.7% decline in the average price.

-- Operating income decreased 4.8% to Ch$ 13,536 million (US$ 25.5 million) in the second quarter 2009 and the operating margin decreased to 14.3% from 18% in the quarter. This mainly reflects the higher average cost in this period and a change of the mix, with larger sales in the segments with lower prices, due to the economic cycle and higher promotional activity in the UK.

-- Non-operating result presented a gain of Ch$ 2,341 million (US$ 4.4 million) as compared to a gain of Ch$ 513 million (US$ 1 million) in the second quarter 2008. This is mainly explained by a gain obtained in exchange rate differences related to forward positions taken by the company as part of its exchange-rate hedging and fixing strategy related to its exports.

Financial Highlights
(in millions of Chilean pesos as of June 30, 2009, except percentages and per
share amounts)

                           2Q2009   2Q2008  Change   1H2009   1H2008   Change

    Revenue from Sales     94,439   79,165   19.3%  162,896  139,951    16.4%
    Gross Profit           35,188   33,373    5.4%   59,671   56,728     5.2%
    % sales                 37.3%    42.2%            36.6%    40.5%
    Selling &
     Administrative
     Expenses             -21,652  -19,153   13.0%  -38,261  -33,415    14.5%
    % sales                 22.9%    24.2%            23.5%    23.9%
    Operating Income       13,536   14,220   -4.8%   21,410   23,313    -8.2%
    % sales                 14.3%    18.0%            13.1%    16.7%
    Non Operating Result    2,341      513  356.6%    3,597   -1,242  -389.7%

    Net Income             12,989   11,668   11.3%   21,384   17,627    21.3%

    Earnings per share
     (Ch$)                  17.57    16.22    8.3%    28.92    24.51    18.0%
    Earnings per ADR
     (US$)                   0.66     0.60   10.3%     1.09     0.90    20.2%

    Ebitda                 16,921   17,111   -1.1%   28,153   29,210    -3.6%
    % sales                 17.9%    21.6%            17.3%    20.9%

A longer version of this press release with detailed information is available on the web site: http://www.conchaytoro.com .

SOURCE Vina Concha y Toro S.A.