Terra Vitae Vineyards

[Southern Lad]

Yields are looking good this season

Won’t the heavy rain this week in Marlborough during Sauvignon Blanc flowering season mean we’re in for another lower yield harvest? Or is the flowering season already finished?

[Ricky-bobby]

In 2-3 weeks time we will have a true picture. The blocks I have looked around it looks massive. Now Not so sure if the Awatere looks as healthy as the wairau we’re most of the tv vineyards are…. Will check out next week

[Southern Lad]

Thanks Ricky-bobby - look forward to your update in due course.

[Ricky-bobby]

So have been out n about and to be honest it’s to early to tell. There’s a lot of variability out there. Also thinking about the wine sector as a whole I think purchasing Delegats shares would be a smarter play long term. They have got massive developments (1000’s of hectares) going in over the next few years. This will take 5-6 years to flow through, but when it does these guys will be massive! Quite a different approach to indevin which is growing by acquisition. Delegat’s are the gold standard in the industry as they make and hold very good GP in a sometimes saturated market.

[Southern Lad]

So have been out n about and to be honest it’s to early to tell. There’s a lot of variability out there. Also thinking about the wine sector as a whole I think purchasing Delegats shares would be a smarter play long term.

Thanks for the on the ground reporting. Keep us in the loop if you learn anything more.

Delegats certainly has achieved massively since listing. Quite a different proposition to TVV as you are buying into an integrated grape grower, wine maker and marketer whereas TVV solely a contract grape grower who is under contractual control of VM, meaning that TVV effectively needs to do what’s best for VM. Question if Indevin/VM may list on the NZX in the future, in which case it probably makes sense for TVV to be absorbed.

[percy]

Thanks for the on the ground reporting. Keep us in the loop if you learn anything more.

Delegats certainly has achieved massively since listing. Quite a different proposition to TVV as you are buying into an integrated grape grower, wine maker and marketer whereas TVV solely a contract grape grower who is under contractual control of VM, meaning that TVV effectively needs to do what’s best for VM. Question if Indevin/VM may list on the NZX in the future, in which case it probably makes sense for TVV to be absorbed.

That could be the same as when Delegats took over Oyster Bay.
At that time there were a number of Oyster Bay shareholders [including Peter Yealands and David Rankin] who thought Oyster Bay was sold too cheaply.
However contract growers do not have a lot of muscle when it comes to the crunch..

[Mr Slothbear]

If its of interest the only wine company I have shares in which up till now has bought all its grpes from contract growers. Their growth and product demand is so high its completely outstripping their ability to supply especially their hungry (thirsty) customers especially in northern hemisphere, UK, ireland. To remedy this they tried to acquire a company that produces bulk wine that had large vineyard leases to get them easy access to more grape supply but sadly the deal fell through due to a finance partner withdrawing last minute so now it seems back to the drawing board and they’re planting out more hectares organically and relying on contract growers but have no doubt they’re watching like hawks for a fast and meaningful increase to hectares planted out.

at least its better to have more demand than you can supply rather than the alternative

[Ricky-bobby]

If its of interest the only wine company I have shares in which up till now has bought all its grpes from contract growers. Their growth and product demand is so high its completely outstripping their ability to supply especially their hungry (thirsty) customers especially in northern hemisphere, UK, ireland. To remedy this they tried to acquire a company that produces bulk wine that had large vineyard leases to get them easy access to more grape supply but sadly the deal fell through due to a finance partner withdrawing last minute so now it seems back to the drawing board and they’re planting out more hectares organically and relying on contract growers but have no doubt they’re watching like hawks for a fast and meaningful increase to hectares planted out.

at least its better to have more demand than you can supply rather than the alternative

Are you talking about invivo? They are definitely a market driven business and do it very well! Unfortunately they have their winery just out of Auckland, which is to far away from the action and will be hard for them to generate efficiencies. The key to success in the Nz wine game is Marlborough Sauvignon Blanc. No other variety generates cashflow as quickly. The land prices for vineyards are getting so high that only wine companies can entertain a purchase. It’s now to rich for growers.

Re indevin listing, don’t know if this will happen. More likely to be bought out by Gallo….

[Mr Slothbear]

Are you talking about invivo? They are definitely a market driven business and do it very well! Unfortunately they have their winery just out of Auckland, which is to far away from the action and will be hard for them to generate efficiencies. The key to success in the Nz wine game is Marlborough Sauvignon Blanc. No other variety generates cashflow as quickly. The land prices for vineyards are getting so high that only wine companies can entertain a purchase. It’s now to rich for growers.

Re indevin listing, don’t know if this will happen. More likely to be bought out by Gallo….

yes exactly invivo, amazing margin expansion this past year. Luckily with their sourcing from many different countries incl france, italy, nz, argentina it significantly decreases geo, weather risk etc…

their planned acquisition was for sav blanc leases in marlborough basically exactly as you describe but fell through

am very happy holder.

[Southern Lad]

2 TVV trades today - 7,000 at 51 and 14,000 at 59. Prior trade was mid November at 49. Not big volumes but someone has confidence in TVV’s future prospects (or got sick of waiting for a seller with lower price expectations to turn up).