PENFOLDS OWNER TWE POSTED RECORD PROFIT DUE TO ROBUST DEMAND IN ASIA
By Susan Lewis
Australian leading wine producer Treasury Wine Estates (TWE), owner of Penfolds brand, posted a whopping 43% increase in pre-tax profit in Asia largely due to strong demand for their premium wines in China.
The company’s annual profit reached a record AUD419.5million (USD284.34m) with the Asian region accounting for the lion’s share.
The group’s operating profits in Asia reached AUD293.5 million, compared with Americas’ AUD218.7 million.
However, Americas remained its biggest market by revenue at AUD1.13billion in sales, ahead of Asia’s AUD748.9m.
The group’s CEO Michael Clarke said their strategy to geographically diversify had helped it cope with the USA-China trade war.
"The results announced ... are a direct result of the investments and structural change our team has made in our global business over the past five years," Clarke said.
“We are not reliant on any individual or any region….Our results reflect that,” he added.
The company has recently bought production and vineyard assets in France’s Bordeaux region, it will ship French wines into China and Asia.
CEO Clarke has high hope in this new strategy and said the company’s ambition was to become the number one importer of French wines into Asia.
It is believed that this strategy would help TWE grow its higher margin upmarket offerings and would reduce risk if Beijing puts more curbs on wine imports from USA where the company owns vineyards and wineries.
(the writer can be contacted at: SusanLewis@thewinechronicle.com)
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