Concha y Toro earnings hit hard by Brexit, poor harvestStaff Writer | May 18, 2017
Chile's Concha y Toro, one of the world's biggest wine makers, said on Wednesday its profit fell more than 20 percent in the first quarter, hit by a poor harvest and a slide in sterling after the UK's Brexit vote.
Concha y Toro Net profit tumbled nearly in half
Net profit tumbled nearly in half to $3.8 billion pesos.
"Concha y Toro faced a challenging external scenario, marked by the depreciation of key currencies for exports," the company said in a statement.
"This affected sales and was combined with a jump in wine costs, a product of a weaker harvest in 2016."
Britain is a key export market for the producer of such brands as Casillero del Diablo, Don Melchor and U.S. affiliate Fetzer-Bonterra.
The vote to leave the European Union in June 2016 has led to a steep drop in the value of the pound, making imports into the country more expensive.
At the same time, wine production in Chile fell an estimated 21 percent last year due to adverse weather conditions.
A growing trend in Concha y Toro's portfolio toward higher-margin premium wines partly offset the difficulties, it said.
It is not yet clear whether the 2017 harvest has been a good one in South America, with high summer temperatures, late frosts, and wildfires raising concerns. ■