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How did Treasury Wine Estates perform in fiscal-2019? - results data

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  • Fiscal full-year sales increase by 12.4% to AUD2.83bn (US$1.91bn)
  • Momentum maintained in second half, after H1 sales rose 12.7%
  • Asia reporting region soars in 12 months to end of June, jumping 35.6% to AUD748.9m
  • Americas region rises 9.4% to AUD1.13bn Europe up 4.4% to AUD346m
  • Australia & New Zealand comes in flat, +0.6% at AUD602.3m

Treasury Wine Estates has enjoyed a bumper 12 months, with sales in fiscal-2019 leaping by low double digits as its Asia performance improved by over a third.

Earlier today, the group reported a 12.4% rise in its top line from the 12 months to the end of June with all four reporting regions posting growth. The increase was in-line with the first half of TWE's fiscal year, when sales were up by 12.7%.

Treasury Wine Estates Fiscal-2019 - Sales versus 2018 - Organic

Source: Company results

Efforts to drive consumers in the direction of premiumisation proved successful for TWE as sales from the 'luxury' and 'masstige' segments of the portfolio rose by 27% in the year. In volume terms, the group was up 2.7% in the 12 months.

The company also noted in today's results statement the purchase of "French production and vineyard assets" in Bordeaux. TWE had flagged its intention to make an acquisition in France earlier this year.

CEO Michael Clarke

"I am extremely pleased to announce yet another high-quality set of financial results for our shareholders in fiscal-2019. Today's results confirm the positive momentum in our business, which is being delivered through our premiumisation strategy, the disciplined investments we have made in our business over recent years and importantly, exceptional execution by our global team.

"While the competitive and macro-economic landscape has presented challenges for the industry in some of our key growth markets, our competitively-advantaged business models and collaborative customer partnerships have enabled TWE to continue delivering strong underlying growth."

Treasury Wine Estates Fiscal-2019 - Sales by Region

Australia & New ZealandAmericasAsiaEuropeTotal
2018598.81037.4552.5331.42519.8
2019602.31134.4748.93462831.6

Source: Company results

  • Americas - Sales +9.4%

TWE's largest reporting region benefitted from recent route-to-market changes, designed to "building ... long-term relationships with distributor and retail partners". The company's focus on its higher-end offerings in the US, including brands such as Penfolds, 19 Crimes and Beringer Brothers, reaped dividends as TWE has moved away from lower-margin "commercial" offerings in the country.

  • Asia - Sales +35.6%

A stellar performance in Asia was the main headline in today's results. Credit was paid to the Australian and French brands in the portfolio, which grew their sales in the region by 44% and 38%, respectively. Without giving specific details, however, TWE noted slowing momentum for its US brands in China, noting that it hopes their momentum " is expected to return once the US/China trade relationship improves".

  • Australia & New Zealand - Sales +0.6%

ANZ dropped below Asia into third place among TWE's reporting regions last year. The flat performance came as a 3% lift in Australia - where the on-premise channel did well for the group - was offset by a decline in New Zealand. TWE noted the effect of a change to its distributor model in the country a year earlier.

  • Europe - Sales +4.4%

Finally, in Europe, the company flagged the ongoing "challenging" wine market conditions in the UK. Pricing pressure on Australian- and US-sourced 'commercial' brands also had a negative impact. That said, a 4.4% rise in sales on a 2.9% volumes lift in the region indicated "strong momentum" for 'masstige' offerings in Continental Europe and the Nordic markets, TWE said.

To access Treasury Wine Estates' official full-year results announcement, click here.

Why the wine consumer is getting angry and what you should do about it - Click here for a just-drinks comment


Expert Analysis

Opportunities in the Americas Wine Sector: Analysis of Opportunities Offered by Countries in the Region

Opportunities in the Americas Wine Sector: Analysis of Opportunities Offered by Countries in the Region

The global wine sector was valued at US$320,303.3 million in 2017 and is forecast to record a CAGR of 7.5% during 2017-2022, to reach US$459,061.9 million by 2022.

VIEW REPORT

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