China accounts for half of Treasury's sales in Asia and 80 per cent of its growth in the region, according to a report in 2018. Treasury Wine tried to capitalize on strong demand of Penfold in China by bundling it with Wolf Blass and Rawson's Retreat. The company was accused of "channel stuffing"- inflating sales by pushing more to wholesalers than they wish.
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The company suffered from a series costly write-downs since its split-off from Fosters. In 2013, Treasury Wine had to destroy six million bottle of wines in U.S.
Globally the company says it has access to more than 13,000 hectares of owned or leased vineyards, with more than 3400 employees, and 36 million cases of wine sold in the 2017 financial year. United States and Canada only), (3) Europe (including Latin America), and (4) Asia (including the Middle East and Africa). The business is divided into four regions: (1) Australia and New Zealand, (2) the Americas (i.e. In July 2020, Michael Clarke stood down as CEO and replaced by long-term executive, Tim Ford. In January 2019, Treasury's share price fell dramatically on a slew of news reports and was targeted by short sellers in the markets who accused the company of engaging in illegal practices including "channel stuffing" in attempts to inflate its profits. More money was spent marketing the most profitable brands. īy 2017, Treasury had begun stockpiling luxury wines and rationing their release in China and the United States. The sale of the US brands represented around one million cases of wine. In July 2016, Treasury Wine Estates slimmed down its wine portfolio, announcing the sale of 12 cheap wine brands in the United States. However, later that year Treasury bought the majority of the wine business of London-based multinational Diageo. In 2015, Treasury reportedly began reducing its presence in the British market to concentrate on Asia, where margins were much higher. In 2014, the board of directors appointed Michael Clarke, a former food executive with Kraft Foods and Premier Foods, as CEO. Treasury has since worked with Accolade Wines to promote bottling efficiency, strengthening its performance in Asia, Australia, New Zealand and Europe. This eventually led to a class-action by disgruntled shareholders which was settled in 2017. Steamrollers crushed millions of bottles of cheap wine to dispose of excess stock in the United States. This left the business in a more fragile state as shares dropped almost A$2 to just above A$4. įurther write-down of stock worth around A$160 million took place in 2013, followed by the redundancy of David Dearie and appointment of interim chief executive Warwick Every-Burns. Treasury Wine Estates officially became a separately listed company the following month, with David Dearie as its CEO. Fosters Group brewing and wine splitĪfter further difficulties in the division resulted in an additional A$1.3 billion write-down, 99 per cent of Fosters Group shareholders agreed at a meeting in Melbourne in April 2011 to split Fosters Group business into separate brewing and wine companies. By 2011, the company had written down the value of the wines division by half since it acquired it at the peak of the market, leaving it worth about A$3.1 billion. In 2008, Foster's chief executive officer Trevor O'Hoy resigned. However, the wine division performed poorly, often draining cash from the highly profitable brewing business. The same year, Fosters acquired the Australian wine-making group Southcorp, adding famous brands including Lindeman's, Penfolds and Rosemount, and around A$1 billion to revenues. By 2005, Beringer Blass was the seventh largest producer of wine in the United States. Through acquisition, it built the division into one of the world's largest winemakers.
These include Lindeman's and Penfolds in Australia, and Beringer Vineyards in the United States.įoster's began to build its wine division from 1995 onwards. Treasury Wine Estates traces its roots back to the establishment of several New World wineries in the 19th century. It was formerly the wine division of international brewing company Foster's Group.
Treasury Wine Estates is an Australian global winemaking and distribution business with headquarters in Melbourne.
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