Treasury Wine Estates’ newly installed chief executive Sam Fischer is bringing in a “transformation programme” that will include a product review and cost cuts at the major Australian wine company.
Shares in Treasury Wine Estates (TWE) today (December 17) sank to their lowest level in a decade following the Penfolds maker’s upgrade, which included canceling a share buyback.
Fischer, who joined in October, said: “We are currently experiencing category weakness in the US and China, two of our key growth markets, which will impact our business performance in the near term. Maintaining the strength of our brands and the health of their respective sales channels is of vital importance to our management team and board as we navigate the current environment.”
It is not the first time this year that TWE has pointed out problems in the United States and China.
In early December, brand owner Frank Family Vineyards forecast an impairment of its US assets, amounting to at least A$687.4 million (then US$450 million).
In October, the Australian wine major also withdrew its fiscal 2026 earnings guidance due to an “uncertain outlook” for its Penfolds brand in China and its Treasury Americas businesses.
TWE, home to brands including Lindemans and Beringer, said today that the company’s new program, called TWE Ascent, would focus on three areas: an “evolution” of its portfolio; changes in the “operating model” of the company and the “optimization” of costs.
The group has a cost savings target of A$100 million a year over the next three financial years.
Fischer added: “I am excited by the opportunity to accelerate a transformation agenda to reshape TWE for its next era, building on these strong foundations. We have begun work to identify opportunities to simplify the way we operate, strengthen our execution approach across the business, and realize significant cost benefits.”
TWE is already reducing customer inventories in the U.S. and China amid what the company called “moderate depletion growth expectations.”
Brand owner Daou Vineyards said the market for “luxury wine” in the United States (wine priced at least $20 a bottle) had declined more than 2% in the past 26 weeks.
Depletions for Treasury Americas as a whole have decreased 4.6% so far this year, the company said.
It is also “significantly restricting shipments that contribute to parallel import activity in China” in a bid to “protect the strength” of the Penfolds brand.
Meanwhile, TWE has scuttled plans to buy back A$200 million of shares in its current financial year.
The company’s shares were trading at A$4.98 at the close of trading today in Australia. The stock price is down nearly 56% so far in 2025. The current level is the lowest TWE stock has reached since mid-2015.