Recently installed Treasury Wine Estates CEO Sam Fischer is bringing in a “transformation programme” that will include a review of products and cost cuts at the Australian wine major.
Shares in Treasury Wine Estates (TWE) sank to their lowest level in a decade today (17 December) after the Penfolds maker’s update, which included cancelling a stock buy-back.
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Fischer, who joined in October, said: “We are currently experiencing category weakness in the US and China, two of our key growth markets, which will impact our business performance in the near-term. Maintaining the strength of our brands and the health of their respective sales channels is of critical importance to our management team and our board as we navigate through the current environment.”
It is not the first time this year that TWE has flagged problems in the US and China.
At the start of December, the Frank Family Vineyards brand owner forecast an impairment on its US assets, amounting to at least A$687.4m (then $450m).
In October, the Australian wine major also withdrew its fiscal 2026 earnings guidance due to an “uncertain outlook” for its Penfolds brand in China and Treasury Americas businesses.
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By GlobalDataTWE, home to brands including Lindemans and Beringer, said today the company’s new programme – dubbed TWE Ascent – would focus on three areas: an “evolution” of its portfolio; changes to the company’s “operating model” and the “optimisation” of costs.
The group has a target for cost savings of A$100m a year over the next three financial years.
Fischer added: “I’m energised by the opportunity to accelerate a transformation agenda to reshape TWE for its next era, leveraging these strong foundations. We have commenced work to identify opportunities to simplify the way we operate, to strengthen our execution focus right across the business and to realise significant cost benefits.”
TWE is already reducing the inventories held by customers in the US and China amid what the company called “moderated depletion growth expectations”.
The Daou Vineyards brand owner said the market for “luxury wine” in the US – wine priced at least US$20 a bottle – had declined by more than 2% in the last 26 weeks.
The depletions from Treasury Americas as a whole are down 4.6% year-to-date, the company said.
It is also “significantly restricting shipments that are contributing to parallel import activity in China” in a bid to “protect the strength” of the Penfolds brand.
TWE, meanwhile, has ripped up plans for a A$200m buy-back of shares in its current financial year.
The company’s shares stood at A$4.98 at the close of trading in Australia today. The share price is down almost 56% so far in 2025. The current level is the lowest TWE’s shares have reached since mid-2015.
