Treasury Wine Estates warns of weaker performance from money-maker Penfolds
In an investor update to the market on Tuesday, the company said it now expects earnings for Penfolds in 2025-26 to record low to mid double-digit growth — down from a previous forecast of about 15 per cent.
It is still expected to make up the lion's share of earnings.
'Following the focus on re-building distribution in China through F25, customer inventory holdings across several of Penfolds' other key markets are below historic levels while depletions remain strong, most notably throughout the rest of Asia,' the update said.
'This is expected to support the delivery of Penfolds' global growth expectations in F26.'
For its Treasury Americas division, TWE said economic uncertainty and weaker consumer demand had been reflected in declining wine consumption trends across key sales channels throughout the second half of the current financial year, a softer market more pronounced at the below $US15 ($23) price points.
The company also revealed a new operating structure to take effect from July 1 that will pour its budget-friendly offerings — including Speaking Pig, 19 Crimes, Wynns, Lindmans, Blossom Hill and Wolf Blass — into a new division called Treasury Collective.
TWE also announced plans to launch an on-market share buyback for up to 5 per cent of its issued capital as part of its full-year results update in August.
The update comes just weeks after the company announced it would need to find a new path into the Californian market after its local distributor said it would cease operations later this year.
The shock decision by Republic National Distributing Company is a serious blow for the winemaker, with the shuttered distributor responsible for about 25 per cent of TWE's sales for its Americas division and 10 per cent of total group sales.
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7NEWS
15 hours ago
- 7NEWS
95-year old vendor will "start thinking about my future" with $2.7m sale
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Sky News AU
4 days ago
- Sky News AU
'Peter Gago's troubleshooter': New Penfolds Director of Winemaking Steph Dutton reveals her priorities across the company's global empire
Introducing Steph Dutton, the new director of winemaking at Penfolds, Australia's greatest wine company. The 39-year-old Melbourne Girls Grammar old girl answers to Peter Gago, the legendary Penfolds chief winemaker who led the vintner's audacious push into US, China and France. The arrival of Penfolds as a global winemaking powerhouse is on show with its new Australian releases where local treasures like Grange, RWT and Bin 389 compete with vintages from the other side of the globe. Under the guidance of Gago and Dutton, Penfolds now manicures a universal vineyard straddling the two hemispheres. At any time in either the Barossa, Coonawarra, Coal River or Napa valleys or at Ningxia in the aptly named Shangri-La vineyards in China, or further south in Yunnan near the Burma border, the grapes are ripening. 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The wine was matured for 18 months in American oak hogsheads. (100 percent new) - More reviews next week.
Sydney Morning Herald
5 days ago
- Sydney Morning Herald
The verdict on the new Grange is in, but it's $1000. Should you splash the cash?
When Penfolds releases its anticipated 2025 Collection on August 7, fine wine collectors around the globe will start to wonder if its biggest star, the coveted 2021 Grange, is worth forking out for. The multi-vintage, multi-vineyard South Australian red is one of the most collectable wines in the world, and the 2021 has a price tag of $1000. So, is it worth the big bucks? The answer is maybe, but it depends on how much patience you possess. If you don't mind holding on to it for a couple of decades and then selling it, the return on investment could prove fruitful. The first Penfolds Grange vintage was 1951 and has been known to fetch more than $150,000 at auction. A full set of Penfolds Bin Grange from the 1951 to 2018 vintages fetched a record $430,000 at the Penfolds Rewards of Patience Auction hosted by Langtons in 2022.
