Treasury Wine Estates announces strong F23 results

August 15, 2023
By Rachel White

Treasury Wine Estates (TWE) announced strong full-year financial results this morning, led by 13.8 per cent revenue growth by Penfolds and the group’s continued premiumisation strategy.

Financial highlights included earnings growth and margin expansion company-wide, with EBITS +11 per cent to $583.5m and EBITS margin +2.9ppts to 24.1 per cent as a result of top-line growth in the luxury portfolio, price increases across several brands and cost-saving strategies.

The long-term consumer trends towards premium wines continue, with luxury wine consumption remaining strong in several of TWE’s key markets, including increases in Asia of (excluding China) 10 per cent, two per cent in the US, 11 per cent in Australia and the UK, respectively.

Tim Ford, Chief Executive Officer at TWE, said the group’s overall performance was driven by sustained demand for luxury wine, price increases and cost saving strategies.

“Performance was driven by continued growth in our luxury portfolios where momentum remains very strong, particularly for Penfolds. Also, through the successful implementation of price increases across several key brands with strong equity, and also through incremental cost savings from a global supply chain optimisation programmes,” he said.

After TWE announced cuts to its commercial wine division and restructuring the Treasury Premium Brands division in May of this year, Ford said at the end of this financial year, 85 per cent of TWEs global revenue is generated from their premium and luxury portfolios, a two per cent increase on last year while commercial sales declined two per cent to $2.4 billion.

“The Penfolds result was clearly a standout with strong double-digit top-line growth, reflecting the strength of this exceptional brand and the outstanding execution by the team they continue to build distribution and grow consumer demand globally,” said Ford.

Moving into F24, Ford said TWE will build on a “great year” of progress from each division in F23 as the group’s strategic priorities remain unchanged.

“Across TWE consistency is what we’re looking to execute. We will continue to leverage our strengths and capabilities globally and make good progress on our key organisation-wide priorities.

“F23 I’d characterise as a really important year for TWE. We adapted and responded to deliver the performance we’re pretty proud to outline today. We look back at the year and recognise we delivered earnings and margin growth whilst navigating the ever-changing consumer and the tightening global economic environment,” he said.

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