Treasury Wine Estates has had a tough H1. Heres a closer look at the companys performance

Treasury Wine Estates has had a tough H1. Here's a closer look at the company's performance

Earlier today (28 February), Treasury Wine Estates posted a marked fall in profits for its fiscal half-year, with sales in the six-month period dipping by 3.3%. Here, just-drinks takes a closer look at the company's performance in the six-month period by region and brand.


In the Americas, volumes slipped by 1.4% to 8.1m cases. Profits before interest and tax and one-off items (EBITS) was down by 2% on a constant currency basis. The cost of goods sold rose by 3.3% per case, while "luxury" volumes fell by 15% due to "supply constraints".

In Europe, Middle East and Africa, volumes fell by 9.2% to 3.4m cases due to the exit from "unprofitable sales" in the UK, and "softer trading conditions" in Continental Europe and the Nordic countries. First-half were flat on a constant currency basis.

In Australia & New Zealand, volumes were flat, down by 0.8% at 4.4m cases. New Zealand volumes fell by 18.3% as Treasury withdrew from some "unprofitable price points" and reallocated supply-constrained wines to alternate markets. Australian volumes were up by 1%, despite " a challenging first-quarter trading environment". EBITS tumbled by 25.5% on a constant currency basis due to higher COGS.

Asia provided a bright spot, with volumes climbing by 11%, albeit from a small base. EBITS leapt by 12.5%, coming in at AUD13.5m.


Treasury suffered from higher COGS in the half-year due to its "deliberate decision" in 2011 that it would "purchase quality grapes" to satisfy consumer demand.

The Lindeman’s and Rosemount brands, along with the company's so-called "masstige" (mass prestige) Wolf Blass brands delivered growth in selected markets and key channels.

In the Americas, Rosemount saw its volumes increase by 9.1%.

Wolf Blass delivered a 5.9% volumes lift in Europe, Middle East and Africa.

Lindeman's posted an increase of 2% in volumes in the Americas.

Beringer Classics and Lindeman’s out-performed their respective categories during the first half, Treasury said.