Treasury Wine furthers US luxury push

New Treasury Wine Estates boss Tim Ford is keen to develop luxury wine in the US and has started exploring selling some of its brands to help prepare the push.

Mr Ford, who started in the role on July 1 and replaced Michael Clarke, has given his first trading update and said a restructure of the US business had been completed and would save at least $35 million in the 2021 financial year.

The savings will help efforts to sell luxury wine, as the company has found it harder to compete at the lower end of the market due to what it says is oversupply in the $US8 to $US15 range.

Treasury Wine Estates has also started examining the sale of some of its brands and assets in the US.

While the US has recently notched record daily infection figures from the coronavirus and its economy remains subdued, Mr Ford said he was optimistic about Treasury’s return to profit growth.

He and his team also continue to explore the potential demerger of Penfolds.

This could happen by the end of the 2021 calendar year.

Meanwhile the company said full-year earnings before interest, tax and the agricultural accounting standard SGARA dropped 21 per cent to between $530 million and $540 million.

The company is due to post full-year results on August 13.

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