Willamette Valley Vineyards Posts a Second Quarter 2010 Profit

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Aug 16, 2010, 07:32 ET

SALEM, Ore., Aug. 16 /PRNewswire-FirstCall/ -- Willamette Valley Vineyards (Nasdaq: WVVI), a leading producer of Pinot Noir, generated a profit of $ 128,287, or $0.03 cents per share for the second three months of 2010. Comparable results for the comparable prior year period include a net profit of $ 253,784 and $0.05 cents per share.

Second quarter 2010 sales revenue increased 1.06% and gross profit decreased -6.91% compared to the second quarter of 2009. The decrease in gross profit along with an increase in sales, general and administrative expenses of 3.7% over the prior year second quarter were the main factors in the decrease in net profit.

Jim Bernau, Founder and President of the winery said, "The cost of goods in sales of current vintages is high, depressing gross profits combined with stronger selling effort are decreasing operating income. The '09 vintage reflects historical costs which should allow gross margins to return to typical levels." Bernau noted he is proud that his Bacchus Fine Wines sales staff reduced purchased wine inventory by over $1 million in 12 months while growing customer service and wine sales.

Willamette Valley Vineyards, Inc. is headquartered at its Estate Vineyard near Salem, Oregon. The Company's common stock is traded onNASDAQ: WVVI.

Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, and are identified by such words and phrases as "expects," "thinks," "believes," "anticipates" and words of similar import. Such forward-looking statements are subject to risks and uncertainties and actual results could differ materially from those projected. Such risks and uncertainties include, but are not limited to: availability of financing for growth, availability of adequate supply of high quality grapes, successful performance of internal operations, impact of competition, changes in wine broker or distributor relations or performance, impact of possible adverse weather conditions, impact of reduction in grape quality or supply due to disease, impact of governmental regulatory decisions and other risks.

WILLAMETTE VALLEY VINEYARDS, INC.
Statement of Operations
(unaudited)

		Three months ended		Six months ended
		June 30,		June 30,
		2010	2009	2010	2009


Net revenues
	Case revenue	$ 4,095,430	$ 4,052,383	$ 7,649,005	$ 7,692,621

Total net revenues		4,095,430	4,052,383	7,649,005	7,692,621

Cost of sales
	Case	2,237,543	2,056,684	4,322,392	3,819,828

Total cost of sales		2,237,543	2,056,684	4,322,392	3,819,828

Gross profit		1,857,887	1,995,699	3,326,613	3,872,793

Selling, general and
	administrative expenses	1,594,620	1,537,775	3,336,103	3,099,509

Net operating
	income (loss)	263,267	457,924	(9,490)	773,284

Other income (expense)
	Interest income	3,310	-	6,129	-
	Interest expense	(56,393)	(36,216)	(109,697)	(68,878)
	Other income (expense)	1,884	1,922	12,963	1,922

Net income (loss) before
	income taxes	212,068	423,630	(100,095)	706,328

Income tax expense/ (benefit)		83,781	169,846	(40,038)	287,388

Net income (loss)		128,287	253,784	(60,057)	418,940

Retained earnings beginning
	of period	6,343,027	5,965,057	6,531,371	5,799,901

Retained earnings
	end of period	$ 6,471,314	$ 6,218,841	$ 6,471,314	$ 6,218,841

Basic earnings (loss) per
	common share	$ 0.03	$ 0.05	$ (0.01)	$ 0.09

Diluted earnings (loss) per		$ 0.03	$ 0.05	$ (0.01)	$ 0.09
	common share

Weighted average number of
	basic common shares
	outstanding	4,888,977	4,858,480	4,888,977	4,855,379

Weighted average number of
	diluted common shares
	outstanding	4,902,345	4,877,738	4,903,394	4,858,146