Yellow Tail owner slips into loss

Casella Wines, owner of Yellow Tail, has slipped into a AU$5.5m loss as weaker US demand, tariffs and rising costs hit earnings, despite growth in other markets such as the UK, Europe and Asia.

Full-year results showed a AU$5.5 million loss, reversing profits of AU$18.6 million in 2024 and AU$26.5 million in 2023. US sales fell about 17 per cent, while higher raw material, energy and freight costs increased pressure across the group.

Casella also lifted debt by around AU$170 million and briefly breached a debt covenant before receiving a bank waiver, highlighting tighter financial conditions. Despite this, management says the business remains stable and is supported by sales growth in other regions.

The wider Australian wine sector continues to struggle with oversupply, falling consumption and restructuring, though producers are adapting through lower alcohol styles, premiumisation and export diversification.