Key facts
- Treasury Wine Estates reported a 41.5% decrease in full-year underlying profit.
- The Americas division experienced a 61.4% decline in earnings.
- Net sales revenue for the Americas division decreased by 21.2%.
- The company recorded a A$1.12 billion impairment charge on its U.S. assets.
- An additional A$611.3 million charge was taken for a strategic review of the Americas business.
Australia's Treasury Wine Estates reported a 41.5% decrease in its full-year underlying profit, largely attributed to a struggling Americas division. The company's earnings before interest, tax, self-generating and regenerating assets and material items (EBITS) from the Americas fell 61.4% to A$90.2 million, with net sales revenue declining 21.2% to A$575 million. This performance was impacted by soft U.S. demand and distribution issues leading to excess inventory. In response, Treasury Wine has initiated a strategic review and restructuring of its Americas operations. The company also recorded substantial impairment charges, including A$1.12 billion on its U.S. assets and an additional A$611.3 million related to the strategic review and supply chain rebalancing efforts in the U.S. Despite the profit drop, the reported net profit after tax of A$275.3 million for the year ended June 30 exceeded the Visible Alpha consensus estimate of A$262 million.