Treasury Wine shares rise on improved outlook
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More news: Treasury Wine Estates share price gained 1.58% to $11.24 by 12.19pm AEDT despite the company posting a 11.4% fall in its half-year profit, as it outlined an improved outlook.
The company also noted it was “prepared and well placed to commence re-establishing” its China portfolio if there is a positive outcome from the country's review of tariffs on Australian wine imports. A determination is expected next month.
Treasury Wine Estates trims dividend on half-year profit drop
The news: Australia’s top winemaker Treasury Wine Estates has posted a drop in half-year profit but a strong performance by its high-end Penfolds brand helped it maintain margins.
The numbers: The company reported an 11.4% fall in first-half net profit to $166.7 million, while revenue was nearly flat at $1.28 billion. Earnings dropped 5.8% to $289.8 million. It will pay an interim dividend of 17 cents per share, down from 18 cents a year ago.
The context: Treasury, the makers of Penfolds, Wolf Blass and Lindemans, said there was strength of demand for luxury wine in key markets, even as consumers continue to shift away from cheaper, commercial wine. Its luxury Penfolds division reported a 2.9% lift in earnings to $186.9 million, but growth was moderated by the planned delay of shipments to the second half of 2024, in anticipation of the possible reopening of its key China market. Its Americas division suffered a 17.5% slide in earnings to $93.1 million as demand for its 19Crimes brand softened. The winemaker expects a stronger second half and aims to deliver mid-high single digit earnings growth for the full year.
The source: ASX announcement
