SA wine firm rehires sacked CEO
The Adelaide-based owner of a series of wine brands has reappointed a CEO it ousted from the role just five months ago.
The owner of Nepenthe has appointed Craig Garvin as CEO, five months after his termination. Photo: Nepenthe.
Following a board reshuffle at Australian Vintage including the resignation of chairman Richard Davis, the company has brought back Craig Garvin as CEO whose position was terminated in May.
Announced this morning, Garvin is once again CEO of the Nepenthe, McGuigan, Tempus Two and Passion Pop owner after acting chief executive Peter Perrin resigned in August following a cancer diagnosis.
Garvin was sacked in May with the board at the time claiming he engaged in conduct that “displayed a lack of judgment and was inconsistent with the values of the company and the high standards expected of its Chief Executive Officer”.
Craig Garvin
But Garvin was welcomed back by the Australian Vintage board today, with the new leaders of the company noting a review had been undertaken into his May 2024 termination.
“The new board of Australian Vintage is pleased to welcome Craig back to AVG,” newly appointed chairman James Williams said.
“His appointment follows an external search that considered a number of exceptional candidates.
“After a thorough review of the circumstances and processes surrounding his departure from Australian Vintage in May, the board felt it was important for Craig to be involved in the search process.”
Williams said Garvin’s appointment “after a difficult period for the company, highlights the board’s laser-like focus on restoring shareholder value”.
“Craig’s track record at AVG, his leadership style and deep understanding of our industry and our partners make him the right person to lead the company,” he said.
“He is a respected and well-liked leader who successfully led the change at AVG in a challenging environment.
“This included the development and implementation of the company’s five-year strategic plan, which transformed the company into a consumer-led business with a commitment to innovation.”
Chair of the board’s people, remuneration and nomination committee Margaret Zabel said Garvin “has demonstrated his ability to create an effective high-performing team, build a strong culture, and develop enduring relationships with customers and other stakeholders”.
“He is the right person to take Australian Vintage forward, and we are looking forward to working with him to create value for our shareholders to deliver great wine brands to our customers,” she said.
Garvin will commence in the role from 14 October with a fixed salary of $600,000 per annum, plus a one-off grant of 5 million shares in the firm.
Since Garvin’s termination in May, Australian Vintage undertook a board renewal process that commenced with the resignation of former chairman Richard Davis in July who served the company for more than 15 years.
Also in July, Margaret Zabel joined the board as a non-executive director, which triggered the resignations of Naseema Sparks and John Davies as directors to maintain the requisite number of board members.
One month later, James Williamson, Elaine Teh and Michael Byrne were announced as new non-executive directors.
The board renewal sparked the creation of a new strategy going forward for the company which said it would improve free cash flow over the next three years. Australian Vintage is now targeting free cash flow of $20 million plus per annum by the end of FY27.
However, the company recently recorded a $93 million loss in the 2024 financial year, down from its $4 million profit the year prior.
The loss was the result of write-downs, including a $37.7 million goodwill impairment and a $36.6 million inventory write-down.
Were it not for the goodwill impairment and inventory write-down, the company’s net profit after tax would have grown by 26 per cent to $5.3 million.
The company also recently placed 74th in the 2024 South Australian Business Index – down 17 positions on the year prior.
Shares in AVG are up 3.23 per cent in early trade today, but remain down 52.94 per cent over the past 12 months.