It also told investors 2021 earnings before interest,tax,depreciation,amortisation and industry accounting standard SGARA would be in the range of $495 million to $515 million,beating market expectations.
Chief executive Tim Ford said he was confident of the prospects for Treasury’s new vision,noting the company did not have “many great ambitions” for its Chinese market at the moment. “The effective closure of the Chinese market to the Australian wine category was a significant event for Treasury,but we are truly excited by the opportunity this now presents to us to accelerate the growth of our business,” he said.
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Treasury has been battered in recent monthsby 200 per cent tariffs placed on its goods by the Chinese government,with the winemaker formerly deriving about 30 per cent of its total earnings from the lucrative market.
The company has been making efforts to diversify away from China in response,placing most of its focus on growing its US divisions and also expanding its offering into other Asian markets such as Thailand,Singapore and South Korea.
On Thursday,Treasury appeared more confident in the success of these plans and set out for investors its targets for earnings in each division. It also revealed for the first time its profit margins for Penfolds,showing the high-end division reported EBITS of $357 million in 2020 at a margin of 47 per cent.
Treasury is hoping to leverage Penfolds’ prestige and brand awareness to further expand the high-margin segment across the globe,including into budding Asian markets such as Thailand,South Korea and Malaysia where Treasury previously did not have wine available to sell.