Treasury Wine Estates (TWE) has scrapped its fiscal 2026 earnings guidance, citing an “uncertain outlook” for Penfolds and its Treasury Americas business.
“As a result of the uncertain outlook in relation to Penfolds and Treasury Americas, TWE has formed the view that it is no longer appropriate to retain its guidance for EBITS growth at a group level in F26,” the Lindemans brand owner said in a trade update today (13 October).
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The company’s update today has prompted a sharp market reaction, with the value of its shares falling more than 15% to A$5.93 ($3.87), their lowest level in more than a decade.
While first-quarter shipments for its fiscal 2026 met group expectations in “key markets”, TWE said it was seeing soft Penfolds sales in China.
“If the performance trends indicated by the preliminary data continue through F26, Penfolds depletions targets for F26 in China are unlikely to be achieved,” the group said.
“Given the uncertainty that remains as to the outlook, TWE is not in a position to provide revised guidance at this point in time”, it added.
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By GlobalDataFor its 2026 fiscal year, TWE had anticipated “low to mid double-digit EBITS growth” for Penfolds but has now scrapped this forecast. It has also withdrawn its 15% EBITS growth expectation for the brand in fiscal 2027.
TWE re-entered China last year following Beijing’s removal of tariffs on Australian wine, which had been imposed in 2020.
In the US, the group said shipments of its Treasury Americas business in its first quarter of 2026 had been hit by the impact of US distributor RNDC’s exit from California, which became effective in September.
The company appointed Breakthru Beverage Group as its new distributor for the US state in July.
In its fiscal 2025 results released in August, TWE said that “modest” EBITS growth in F26 for Treasury Americas was dependent on offsetting the effect of lower shipments in California through talks with RNDC.
At the time, the company said it expected a A$50m hit to net sales revenue of its Treasury Americas business in its fiscal 2026 from changing distributors in California.
In its note today, TWE said talks were ongoing with RNDC “with both parties seeking a practical solution”.
“While optionality exists regarding the management of this inventory, there may be an additional impact to TWE’s F26 shipments and operating plan NSR, depending on what is ultimately agreed between TWE and RNDC,” the Melbourne-headquartered business said.
The group added it has also paused its on-market share buy-back programme “until there is greater clarity around trading conditions and expectations”.
