Treasury Wine Shares Slump To 11-yr Low After Flagging US, China Slowdown

Shares of Treasury Wine Estates slid sharply on Wednesday after the winemaker warned of weaker near-term conditions in its key U.S. and China markets, prompting it to flag pressure on earnings in the first half of fiscal 2026.

Sydney-listed shares of the company dropped as much as 17% to A$4.57, their lowest level since January 2015.

The Australian wine group said category dynamics have softened in recent months, particularly in the U.S. and China, with any near-term improvement now seen as unlikely.

As a result, Treasury Wine said it would scale back shipment volumes to better align with lower depletion growth and reduce elevated customer inventory levels in both markets.

Treasury Wine forecasted first-half fiscal 2026 earnings before interest and tax of between A$225 million and A$235 million, down sharply from A$391.4 million a year earlier.

In China, the company said parallel imports were disrupting pricing for its flagship Penfolds brand, leading it to restrict shipments contributing to that activity and cut distributor inventories by around 0.4 million cases over two years.

In the U.S., weaker demand in California and disruption from a distribution transition have weighed on performance, with national depletions down year-to-date, the company said.

The company also cancelled an on-market share buyback of up to A$200 million, citing the need to preserve balance sheet flexibility, after completing A$30.5 million of purchases earlier in the year.

Source: Investing