Treasury Wine Estates dumps cheap US wines
Treasury Wine Estates, the world’s largest standalone wine maker, has announced it has divested its cheap non-core commercial brand portfolio in the United States.
The Australian company said it is selling 12 brands at book value. That amounts to one million cases of non-core commercial wine.
The sale price was not disclosed.
The company said it had been managing down this portfolio of brands.
It said the divestment would have “nil impact” on its earnings.
Treasury has also foreshadowed earnings this year in line with market expectations of $330 million to $340 million.
The company also said it expected minimal impact from Britain’s decision to exit the European Union.
It said Europe represents less than 10 per cent of its earnings and it had an active hedging strategy on the majority of its commercial wine exports to the United Kingdom.
Treasury’s 45 wine brands include Australia’s Penfolds, Wolf Blass, Rawson’s Retreat and Lindeman’s, and a number of US labels including Beringer and Sterling.
The company posted a $77 million profit last financial year.
by Leon Gettler, July 5th 2016
