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Send  Share  RSS  Twitter  21 Nov 2011

WINE: Strong Year For Simonsvlei


Recent Western Cape Business News

Simonsvlei Wines bucked the global economic downturn with a highly successful year both in terms of financial and product achievements.  The Paarl-based winery controls approximately 1,200 hectares of prime Boland vineyards and its diverse product portfolio stands at the heart of its successes.  The Simonsvlei wine offering covers all price tiers in both the domestic and international markets.  “We meticulously de-invested from some value destroying markets and focussed on channels that offered continued opportunities,” said Francois De Manielle, Chairman of the Board.

According to Simonsvlei managing director Leonard van den Berg, the company showed significant improvements on the bottom line.  “Although we cannot release detailed financial information in the public domain due to our limited shareholding, we have achieved impressive results in gross profit, operational profit and year-on-year figures.  The fact that we could accomplish this within the current weaker sales environment and relatively strong Rand is definitely encouraging.  Simonsvlei remains committed to its South African base, especially its world-class production and bottling plant in Paarl.”

Although expecting a challenging year ahead, Van den Berg is confident that the company will continue its good performance.  “Sales channels are expected to remain unpredictable and we anticipate relatively volatile currency movements, but we will continue to drive costs down without sacrificing the good quality of our wines.  We will maintain our focus on the channels that offer us opportunities and continue to explore non-traditional export markets,” explains Van den Berg. 

Van den Berg reckons sound financial practices and management also boosted the company’s performance.  Leading global accountancy firm PriceWaterhouseCoopers commended Simonsvlei for the high quality of its record-keeping and current financial reporting.  The company’s long-standing investment in information systems, which are continuously scrutinised and improved based on personnel recommendations, provides a solid platform for best business practises.

In conclusion, Van den Berg also acknowledges the input from shareholders and board members.  “Simonsvlei Landbou Beherend, our largest shareholder, provides the lion share of our grape requirements.  This stabilises our production planning and contributes to effective long-term planning and quality.  I am convinced that this supply chain management has also been instrumental in securing a string of accolades, including a gold Veritas award and the prestigious Mundus Vini Double Gold for our Simonsvlei Paragon SMCV in Germany.  The board has to be commended for its continued leadership and foresight in providing a platform for management to build a strong financial environment,” stated Van den Berg.

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