Australian Vintage locks in $128M refinancing to fuel global wine expansion
What's the deal? Australian Vintage (ASX:AVG), one of Australia's leading wine producers, has refinanced its structural debt with new facilities totalling $128 million. The deal runs until March 2028, with an option to extend to 2029. It includes a $5 million increase earmarked for the global expansion of its Poco Vino brand, particularly into the US market, with the interest rate unchanged.
Why now? The company is riding strong momentum. Second-half cash generation swung to a positive $20 million, up from negative $9 million in the prior year's comparable period. Sales in the second half are tracking 10% higher than the first, and revenue growth is projected at 5% — reversing a 2% decline in H1.
Poco Vino, the company's low-alcohol wine brand, is now in over 8,000 stores globally and targeting an annualised run rate exceeding $20 million into FY27. Lemsecco posted 116% growth in Australia, while the newly acquired MadFish brand and the Graham Norton distribution deal in the UK collectively add over $12 million in annualised net sales.
McGuigan, the company's flagship label, continues to outperform in Australia and holds the top spot among zero-alcohol still wine brands in the UK.
What could go wrong? Net debt is projected at $90 million for the full year, reflecting heavy strategic investment. The company flagged that shipping challenges may push some sales into FY27. Ongoing inflation and costs from global disruptions also remain headwinds, though management affirmed its FY26 guidance for neutral free cash flow excluding investments.
Australian Vintage is also actively managing down its bulk wine inventory, expecting to end the year with roughly 90 million litres in storage — a sign of lingering oversupply pressures across the industry.
The signal: The deal reflects a broader trend in the wine sector: legacy producers leaning into low- and zero-alcohol products and international distribution to find growth in a challenging market. With consumer preferences shifting and traditional wine volumes under pressure, companies that can build brands in emerging categories — like Poco Vino — are betting that innovation, not volume, will drive the next wave of returns.
Read more: finnewsnetwork.com.au
