AUSTRALIAN VINTAGE LTD — AGM Information 2012

Nov 27, 2012

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ANNUAL GENERAL MEETING 28 NOVEMBER 2012

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Disclaimer

The information in this presentation is general advice, given in good faith and derived from sources believed to be accurate at this date but no warranty of accuracy or reliability is given and no responsibility arising in any other way including by reason of negligence for any errors or omissions is accepted by Australian Vintage Ltd.

Before making an investment in Australian Vintage Ltd, the investor or prospective investor should consider whether such an investment is appropriate to their particular investments needs, objectives and financial circumstances.

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ANNUAL GENERAL MEETING 28 NOVEMBER 2012

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Today’s Agenda

Performance Summary Business Update Formal Proceedings

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Ian Ferrier Neil McGuigan Ian Ferrier

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PERFORMANCE SUMMARY IAN FERRIER

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Shareholders Rewarded for Operating Profit Improvement

1. Net profit up 8% to $7.1m

2. EBIT (after significant items) of $23.4m compared to $22.6m last year

3. Net Profit (before significant items) down by $3.2m against prior year due mainly to reduced yield from owned vineyards

4. Cash flow from operating activities positive $10.6m v $1.3m last year

5. Net debt reduced by $31.9m to $129.1m

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2012 a Standout Vintage for Quality

1. Vintage estimated at 1.6 million tonnes in line with 2011. Expectations are that it will be recognised as a standout vintage in terms of quality

2. While overall grape production is close to balance with total sales, the Australian industry is vulnerable to returning to oversupply because current bearing area could produce higher yields in the future

3. Short term world wine shortage has been predicted after forecasts that the global production would slump to its lowest in at least 37 years following inclement weather

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Strong Revenue Performance Despite Strong $A Impact

1. Operating revenues amounted to $228.0m after unfavourable exchange rate movements of $3.9m

2. Operating Cash Flow positive $10.6m

3. Net debt to equity reduced to 54% from 69% last year

4. SGARA (fair value of grapes picked), down $4.1m due to below average crop from owned vineyards

5. Bank funding secured for another two years

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Continued Response to Industry Challenges – Focus on Branded Sales & Cash flow

1. Continued focus on branded sales

• McGuigan Wines ranked the World’s 19[th] most admired wine brand by UK trade publication Drinks International

• McGuigan Wines entered the top ten global wine brands in the UK

• Take advantage of our enhanced reputation as a low cost premium wine producer

• Continue to control cash flow and expenditure

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Outlook

• Industry

• will remain very challenging

• oversupply continues to reduce

• while grape production appears to be in balance, we are vulnerable to returning to oversupply because our bearing area could produce higher yields in future vintages

• competition fierce across Australia and overseas markets

• high Australian $ continues to hamper margins making recovery of the wine industry slow

• Australian Vintage

• expect to continue to grow the export and domestic segment

• Sales for the six months to December 2012 are expected to be down 6% year on year. Decline mainly in lower margin products such as casks

• Profit to December 2012 is expected to be lower than last year as a result of higher grape costs from the lower 2012 vintage

• But, based on normal vintage conditions, we expect our full year profit to be in line with last year

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BUSINESS REVIEW NEIL MCGUIGAN

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Vision for AVL

TO MAXIMISE RETURNS ON SHAREHOLDERS FUNDS

1. How will this be done

• Putting the “wine” back into the wine business

• Making the wine the “hero” in every facet of our business  branded

  • private label

  • exclusive label

  • contract winemaking

• Putting personality and romance back into wine

• Building confidence in our brands with our customers and consumers

• Creating strategic alliances in developed and emerging markets

• Innovation in wine style and packaging that is market appropriate

2. Areas of concern

• Foreign exchange rates

• Global over production and the emergence of quality alternatives

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Impact on Foreign Exchange Movements on Results and Business

• With approximately 62% of our total export sales in GBP, 6% in Euro and 2% in CAD, AVL’s exposure to exchange rates in significant

• The average weighted GBP in 2011/12 was 0.65 compared to 0.62 in the previous year. This resulted in a negative impact on 2012/13 UK sales of $3.0M with a further negative impact of $0.9M on other foreign currency sales

• The higher exchange rates have had a negative impact of $2.6M on EBIT, after taking into account all foreign currency production costs and other foreign currency expenses

• AVL has adopted a number of strategies to reduce the impact of the high GBP

• including:-

• Shifting 90% of export product packaging and bottling from Australia to the UK.

• Hedging to cover 75% of net exposure in Year 1, 50% in Year 2 and 25% in Year 3 (in accordance with the hedging policy).

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Global Production

Short Term

2012 Vintage Volumes

• Very good - Australia, USA

• Poor - NZ, Spain, Italy, France

Long Term

• Globally planting is continuing in USA, Chile and Argentina

• Grape growing is agriculture, and a low yielding year is usually followed by a higher crop, therefore Australia has the potential for a large 2013 vintage.

• Therefore Australia’s differentiation must be driven by quality, new varieties and innovation

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Brand Growth across all major brands

1. McGuigan

• International Winemaker of the Year 2009 | 2011 | 2012 – International Wine & Spirits Competition

• Australian Producer of the Year 2009 | 2011 | 2012 - International Wine & Spirits Competition

• White Winemaker of the Year 2009 | 2012 – International Wine Challenge

• International Semillon Trophy 2011 | 2012 – International Wine & Spirits Competition

• Black Label Red – Australia’s top selling branded bottled red wines by volume

• McGuigan is the 8[th] largest wine brand in UK by value

• McGuigan is the 2[nd] largest wine brand in Ireland by value

• 19[th] Most Admired Global Wine Brand – Drinks International (UK)

• Globally, McGuigan Wines enjoyed a 17% volume increase, & 10% value growth YOY

• McGuigan Wines sold 2.5M cases (9LE) world wide in FY12

Global McGuigan Volume Growth

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3,000,000
2,500,000
2,000,000
McGuigan
1,500,000
1,000,000
500,000
-
FY8 FY9 FY10 FY11 FY12
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Cases (9LE)
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Tempus Two

Varietal Semillon Sauvignon Blanc 2012 – Trophy Perth Wine Show Varietal Semillon Sauvignon Blanc 2012 – Trophy Riverina Wine Show Pewter Semillon 2011 – Trophy Hunter Valley Wine Show

Pewter Botrytis Semillon 2009 – Gold Medal Pacific Rim Wine Competition Varietal Verdelho 2012 - Gold Medal Pacific Rim Wine Competition Copper Zenith Semillon 2003 – Trophy Hunter Valley Wine Show Copper Zenith Semillon 2007 – Semillon Trophy Perth Wine Show

Domestically, the Tempus Two Varietal range enjoyed a 12% value increase YOY; the Tempus Two Copper range was in value growth by 9% YOY.

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Nepenthe Wines

Australian Sauvignon Blanc Trophy 2009 | 2012 – Decanter World Wine Awards Altitude Shiraz 2010 – Gold Medal Decanter World Wine Awards Winemaker Select Late Harvest Riesling 2010 - Trophy International Sweet Wine Challenge Ithaca Chardonnay 2011 – Gold Medal Australian Cool Climate Wine Show Ithaca Chardonnay 2010 – Gold Medal International Wine Challenge International Chardonnay Trophy 2009 – Decanter World Wine Awards Domestically, the Nepenthe Altitude range enjoyed a 9% value increase YOY

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2012 AVL Show Results Total Medals: Trophies 22, Gold 57, Silver 107, Bronze 201 = 367

	McGuigan	Trophy	IWSC – Australian Producer of the Year	McGuigan
		Trophy	IWSC – International Winemaker of the Year 2012	McGuigan
		Trophy	IWC – International White Winemaker of the Year	Neil McGuigan
		Trophy/Gold	IWC – Best Eden ValleyRiesling	McGuigan Shortlist Riesling2010
		Trophy	IWSC – Best Semillon	McGuigan BIN 9000 Semillon 2004
		Trophy/Gold	COWRA – Best DryWhite Table Wine of Show	McGuigan Vineyard Select Semillon 2005
		Trophy	CAIRNS – Champion Wine in Show	McGuigan BIN 9000 Semillon 2003
		Trophy/Gold	CAIRNS – Champion Wine in Show	McGuigan BIN 9000 Semillon 2003
		Trophy	HUNTER VALLEY – Museum Vintage DryRed Wine	McGuigan Personal Reserve Shiraz 2000
		Trophy/Gold	GRIFFITH – Best Semillon	McGuigan Vineyard Select Semillon 2005
		Trophy	RUTHERGLEN – Best Dry White Table Wine Semillon	McGuigan BIN 9000 Semillon 2007
		Trophy	HONG KONG IWSC – Best Semillon	McGuigan Vineyard Select Semillon 2005
	Tempus Two	Trophy	HUNTER VALLEY – One Year Old DryWhite Wine	Tempus Two Pewter Semillon 2011
		Trophy	HUNTER VALLEY – Museum Vintage DryWhite Wine	Tempus Two Copper Zenith Semillon 2003
		Trophy/Gold	GRIFFITH – Best Semillon Blend	Tempus Two Semillon Sauvignon Blanc 2012
		Trophy	PERTH – Best Sem Sauv Blanc or Sauv Blanc Sem	Tempus Two Semillon Sauvignon Blanc 2012
		Trophy	PERTH – Best DryWhite Table Wine Blend	Tempus Two Semillon Sauvignon Blanc 2012
		Trophy	PERTH – Best Semillon	Tempus Two Copper Zenith Semillon 2007
		Best of Class	PACIFIC RIM	Tempus Two Copper Zenith Semillon 2010
		Gold x 3	DECANTER,COWRA,ADELAIDE	Tempus Two Copper Zenith Semillon 2007
		Gold	ADELAIDE	Tempus Two UNO Semillon 2011
	Nepenthe	Trophy/Gold	DECANTER – Best Aust Sauvignon Blanc over £10	Nepenthe Altitude Sauvignon Blanc 2011
		Trophy/Gold	INTERNATIONAL SWEET WINE CHALLENGE	Nepenthe Winemaker Select Late Harvest Riesling 2010
		Gold	DECANTER	Nepenthe Altitude Shiraz 2010
		Gold	IWC	Nepenthe Ithaca Chardonnay2010
		Gold	AUST COOL CLIMATE WINE SHOW	Nepenthe Ithaca Chardonnay2011
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Marketing Initiatives to continue to drive growth

McGuigan Wines

McGuigan City Vineyard Dublin

McGuigan Black Label ‘Win a VW Golf’ Promotion

Exclusive Labels: McGuigan Reserve & McGuigan Classic

UK Celebrity Partnership: John Torode

Nepenthe Wines

‘Best Australian Sauvignon Blanc’ Decanter World Wine Awards Campaign

Tryst by Nepenthe Relaunch

Official Sponsor: Kooyong Classic

Official Sponsor:

St. George Illawarra Dragons

Miranda

Summer Hues ‘Health & Well Being’ Campaign

Tempus Two

Official Sponsor:

Mercedes-Benz Fashion Festival

Official Sponsor:

Fashion Week

Cellar Door

Wine Club Focus:

Continuity Programme across McGuigan Wines, Tempus Two & Nepenthe Wines

Tempus Two Pewter Distribution Drive / Promotion / Window Displays

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Show footage

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New Product Launch - UK

• Vinni

• Sparkling Moscato

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• 5.5% Alcohol

• Pint Bottle

• £3.49

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2012 International Wine & Spirit Competition UK

McGuigan Wines International Winemaker of the Year Australian Producer of the Year Best Semillon in the World – 2004 Bin 9000 1 Trophy, 9 Gold, 22 Silver, 8 Bronze 100% Strike Rate

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Responsibility to Shareholders

1. AVL management is fully aware that we work for you, the shareholders.

2. AVL’s management is continually reviewing costs, new business opportunities and innovation to increase profitability and to maximise a return on shareholders funds.

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Summary

• AVL continues to review its cost base to ensure it is appropriate for the size of its business.

• AVL’s branded business, private label, exclusive label business and contract winemaking services have the same level of quality commitment.

• AVL will continue to focus on our core brands, McGuigan, Tempus Two, Nepenthe and Miranda.

• AVL will continue to evolve our wines styles, innovate with packaging and increase our category performance, particularly in sparkling wine and in the reduced and low alcohol areas.

• AVL is focusing our marketing activities on distribution and execution closer to the point of sale.

• AVL will continue to capitalise on existing markets, and increase investment in time and resources will be increased in emerging markets eg: China

• AVL is proud of the quality across our brands and ranges and will continue with the objective of delivering “the best quality wine at every price point.”

• AVL believes that quality is what will ensure the Australian wine industry overcomes its present challenges.

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