Treasury Wine generated EBITS of $308 million for the six months ended December 31.īarrenjoey analyst Tom Kierath said the full-year forecast for sales being down 2 to 3 per cent implied a sales decline of about 7 per cent in the June half. The company said on Thursday that it expected to produce earnings before interest, tax and the SGARA accounting standard and material items between $580 million to $590 million. ![]() That would enable more resources to be ploughed into the luxury end of the market and the Penfolds business. “With changing consumer preferences and a tightening economic environment in most major markets, we’re taking the opportunity to make changes in our business now,” he said. Mr Ford said the commercial wine category generally faced falling margins, with inflationary costs in packaging and transport adding to profit pressures. The group’s 19 Crimes label, which has American rapper Snoop Dogg as the face of the brand, is struggling to match the growth of the past year. The entry-level premium wines market in the United States is also showing signs of a further weakening as US consumers cut back. Shares in the company dropped 6.3 per cent to $11.96 on Thursday.Īmerican rapper Snoop Dogg has been front and centre of 19 Crimes brand - but sales are struggling now. The company warned on Thursday that overall sales across the entire group would be down by 2 to 3 per cent in 2022-23, with declines in the Treasury Premium Brands and the Treasury Americas business pulling the numbers down, offset partially by a continued solid performance from the Penfolds luxury wines division. That division includes major brands Wolf Blass, Lindemans, Squealing Pig, Pepperjack, Wynns, Seppelt and 19 Crimes. ![]() ![]() Treasury Wine Estates may pursue asset sales in a broad cost-cutting and restructuring push at its commercial wines business where sales have slipped faster than expected because of cost-of-living pressures on households.Ĭhief executive Tim Ford said on Thursday a major overhaul of the affordable Treasury Premium Brands business was accelerating, with the market dynamics only likely to worsen over the next year for wines priced at less than $15 per bottle.
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