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Penfolds owner posts healthy profit lift

Business

Treasury Wine Estates has raised a glass to shareholders, upping its interim dividend following a 15.1 per cent lift in first-half profit to $201.1 million.

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The world’s largest listed winemaker reported its best ever sales revenue growth, up 13 per cent on a constant currency basis for the six months to December 31.

Total revenue rose 15.1 per cent to $1.54 billion, with the company reporting growth across its Asian, American, European, and Australian segments.

Treasury, which boasts Penfolds, Wolf Blass and Lindeman in its portfolio, will pay an interim dividend of 18 cents – up from 15 cents a year earlier.

The winemaker attributed the result to its focus on higher-margin premium wines and last year’s overhaul of its distribution network in the US.

“Like in previous years, we’ve delivered on expectations while continuing to implement significant changes to the business and investing for future growth,” chief executive Michael Clarke said.

“The results presented today demonstrate not only the strength of our premiumisation strategy and global balance, but in particular they highlight the strength of our competitively advantaged regional business models.”

Underlying earnings in the Americas rose 12 per cent to $112.1 million after Treasury decided it would change how it distributed its wines in the US on a state-by-state basis, with a focus on what delivered the best performance.

Asian earnings grew 31 per cent to $153.1 million, driven by the increased availability of luxury and masstige wine.

Treasury aims to grow its share of China’s imported wine market by focusing on French wine – which accounts for 30 to 40 per cent of the country’s market – under its Maison de Grand Esprit label.

Treasury Wine’s first half results

NET profit up 17.1pct to $219.2m

REVENUE up 15.1pct to $1.54b

FULLY FRANKED interim dividend up 3.0 cents to 18 cents

– AAP

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