New Name for an Old Favourite

Article Excerpt

ANDREW PELLER LTD. $12 (Toronto symbol ADW.A; Income Portfolio, Consumer sector; SI Rating: Above average) is the new name for Andres Wines Ltd. The company is Canada’s second-largest producer of wines (after Vincor International Inc.), with about 12% of the market. It sells its products through provincial liquor agencies, as well as roughly 100 retail stores in Ontario. Revenues grew at a compounded annual rate of 11.1%, from $139.0 million in 2002 (fiscal years end March 31) to $211.8 million in 2005. Part of the company’s growth comes from acquisitions, particularly small wineries that specialize in high-quality wines. That has paid off, since premium wines generate higher profits for Peller than regular wines. That trend will likely continue. Recent medical studies that link moderate wine consumption with certain health benefits have also spurred sales. Profits rose from $0.38 a share (total $5.3 million) in fiscal 2002 to $0.63 a share ($9.0 million) in 2004 (all per-share amounts adjusted for a 3-for-1 stock split…

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