Treasury Wine Estates has announced the sale of 12 US wine brands, as part of its move away from the entry-level segment to focus on the prestige market.
According to Drinks Business “a spokesperson said the sale would account for around one million cases of wine, however the brands in questions, and potential buyers, were not disclosed.”
A statement by TWE said: “The divestment will have nil impact on earnings in F16 and beyond.”
TWE also foreshadowed its 2015-16 earnings would be between $330m and $340m, driven by continued momentum across all regions.
Chief executive Michael Clarke has made no secret of his plans to strip “non-core” brands out of the business. He told analysts in 2014 he would take a “cold” approach to assessing the earnings of all the company’s brands.
Clarke was appointed following TWE making a loss of $101m in the 2013/14 financial year. In 2015, the company reported a net profit of $77.6m after tax. The company’s 2015/16 full year results will be released on August 18.
Last year, the company purchased most of Diageo’s wine division for $754m. The sale included Chateaux & Estate Wine in the US, including brands such as Blossom Hill, Piat d’Or, Beaulieu Vineyards, Acacia, Provenance and Hewitt and Sterling Vineyards.
“We remain committed to our strategic road map of transitioning our business from an order-taking agricultural company to a brand-led and capital-light, marketing organisation,” Clarke noted at the time of the aquisitions.
