FY25 had headwinds and tailwinds for Treasury Wine Estates (TWE), with double-digit earnings growth coming from a growing luxury wine portfolio and Californian winery DAOU delivering its first full year contribution. While the company commits to a luxury-led business model, its premium wine portfolio continues to create headaches.
Snapshot
- Earnings before interest and taxes (EBITS): $770.3m, up 17% on previous year (pcp);
- EBITS margin: 26.2%, up 2.2 points;
- Net profit after tax (NPAT) before material items and SGARA: $470.6m up 15.5%;
- Group net sales revenue (NSR): $2.9b, up 7.2%; and
- NSR per case: $138 per case, up 10%.
Luxury wine represented 55 per cent of Group NSR, with Penfolds reporting EBITS growth of 13.2 per cent to $477 million. The removal Chinese tariffs continues to pay dividends for TWE’s momentum in the region.
Despite softness in the broader US market, Treasury Americas’ EBITS surged 33.9 per cent to $308.6 million, led by DAOU (up 8.2 per cent NSR) and Frank Family Vineyards.
DAOU is ranked number one in the US luxury wine segment, achieved through distribution gains and brand performance, TWE said.
There were not such tailwinds for Treasury Premium Brands – its EBITS fell 27.6 per cent as Commercial and mid-tier markets showed no uptick in demand in Australia or EMEA.
The company said the restructuring of the business into the Treasury Collective will stabilise performance and support brands that are showing growth.
Not all parts of the portfolio had tailwinds. Treasury Premium Brands’ EBITS fell 27.6% as the Commercial and mid-tier segments faced soft demand in Australia and EMEA. However, TWE’s restructure of its Premium operations into the new “Treasury Collective” division is aimed at stabilising performance, with priority brands such as Squealing Pig and Matua showing solid growth.
Operating cashflow was up 22.9 per cent, debt metrics improved, and shareholders will see a total dividend of 40 cents per share, up 11.1 per cent year-on-year. TWE also unveiled a $200 million on-market share buyback to be executed during FY26.
Outgoing CEO Tim Ford, who will hand over to Sam Fischer in October, described FY25 as a year of transformation and strategic clarity. “We’ve strengthened our position in Luxury wine, returned Penfolds to growth in China, and set the business up for long-term success,” he said.
