Treasury Wine Estates retains commercial brands after failing to secure satisfactory offer
AUSTRALIA – Treasury Wine Estates (TWE) has decided to retain its commercial wine brands after failing to receive a compelling offer.
In a statement, TWE revealed that the bids received for brands such as Wolf Blass and Yellowglen did not represent sufficient value, leading the group to opt against divestment.
The decision follows the company’s August 2023 strategic review, which sought to evaluate the future of its global portfolio of premium brands.
The portfolio under review included brands such as Lindeman’s, acquired in 2005, and Blossom Hill, purchased in 2015.
However, with commercial brands contributing less than 5% of the company’s gross profit in fiscal year 2024, the company has decided to maintain ownership.
The announcement coincided with the release of TWE’s first-half results for fiscal 2025, which included a profit warning.
The group now expects earnings before interest, tax, and SGARA (EBITS) to reach approximately A$780 million (US$498.1 million) for the full year—at the lower end of its previous forecast range of A$780 million to A$810 million (US$513.5M).
The revised outlook is primarily due to lower-than-expected performance from Treasury Premium Brands (TPB).
In the first half of 2025, TPB’s EBITS dropped 29.9 percent to A$23 million (US$14.6M), with EBITS margin falling 5.3 percentage points to 6.4 percent.
The company cited weakened consumer demand for lower-priced wines and an underperformance relative to the broader wine category as key factors behind the decline.
Net sales revenue grew 20.2 percent (20.5 percent in constant currency) to A$1.5 billion, while group EBITS surged 35.1 percent to A$391.4 million (US$248.1M).
The company attributed its EBITS margin expansion of 2.8 percentage points to 25.3 percent to strong luxury portfolio growth from Penfolds and contributions from Daou.
Net profit, excluding one-off items, rose 33 percent to A$239.6 million (US$150 million), narrowly missing analysts’ expectations.
Last August, TWE announced plans to restructure its premium brands portfolio by merging Treasury Premium Brands with Treasury Americas Premium to form a new Global Premium Brands division.
The integration is set to be completed by July 1, 2025, with Angus Lilley, the current managing director of Treasury Premium Brands, leading the new division.
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