Penfolds owner won't compromise on price as earnings wobble
Departing chief executive Tim Ford said the company would spend an extra $10 million to expand its sales force in China – the biggest market for Penfolds, which generates almost 60 per cent of Treasury Wine's profits.
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West Australian
10 hours ago
- West Australian
Treasury Wine Estates faces China growth concerns amid changing drinking habits
There are 'cracks appearing' in Treasury Wine Estates' China prospects, analysts say, as consumer preferences shift from large banquets to lifestyle-oriented occasions. Unveiling its full-year results on Wednesday, Australia's top wine producer flagged a recent shift in alcohol consumption behaviour in China, with less large-scale banqueting and more smaller scale occasion events. Citi analyst Sam Teeger warned this did not 'bode well' for the rest of the new financial year, with Barrenjoey's Tom Kierath expecting the China commentary to weigh on TWE's shares on Wednesday. However, the stock was up 3.5 to $7.90 in early trade. TWE said full-year net profit before material items was 15.5 per cent higher than the previous financial year at $470.6 million. Earnings grew 17 per cent to $770.3m, driven by its high-end Penfolds label and a full year contribution from its Californian wine operation DAOU. It also announced a share buyback of up to $200m. Penfolds division earnings rose 13 per cent to $477m, driven by strong growth in its Bin and Icon shipments to China. Outgoing chief executive Tim Ford said it 'continued to face headwinds in a number of markets'. Penfolds managing director Tom King later told analysts on a call it had strong plans for the mid-autumn festival in China in October and was 'feeling pretty good around how the initial collection release has gone down in China'. 'I think we've proven over recent years that we're pretty good at adapting to shifting environments,' he said. 'China is a very dynamic market for sure and things can change very quickly. 'We've got levers that we can pull as demand increases and decreases across our global business.' But Mr Teeger said: 'We think today's incrementally more cautious tone on (China) could lead to some of the China bulls on the stock to moderate their growth expectations. RBC Capital Markets analyst Michael Toner said a key question was whether the softness observed in China in June and July would persist for the remainder of the financial year. Treasury Americas delivered a 33.9 per cent lift in earnings to $308.6m, despite slowing sales for the Snoop Dogg-backed 19 Crimes. Treasury Premium Brands suffered a 27.6 per cent decline in earnings to $55.1m. TWE is forecasting a $50m hit to revenue this financial year from changes to its wine distribution model in California, with its local distributor ceasing operations later this year. It declared a final dividend of 20¢ a share. Mr Ford will leave the company at the end of September to make way for incoming chief Sam Fischer, who was poached from alcohol giant Lion.
Sky News AU
31-07-2025
- Sky News AU
New $1,000 Penfolds Grange 2021 lauded by top global wine critic as 'close to perfect'
Penfolds Grange is still knocking them dead, with critics in the UK, Europe, the US and Australia awarding the latest release 100 points. International scribe Ken Gargett set the tone when he said the Penfolds Grange 2021 ($1,000) 'simply dances with joy'. 'This is as close to a perfect Grange as I can imagine,' he said. Gargett's reviews are published in Wine Pilot, World of Fine Wine and Quill and Pad. He added: 'One simply gets lost in the nose, just endlessly sniffing the most glorious cassis notes, along with black fruits, blueberries, coffee beans, aniseed, mulberries, delicatessen meats, tobacco leaves, plums and graphite. 'The wine is seamless, intense and immaculate with knife-edge balance.' Other scribes who gave it top scores include Australians Tony Love, Nick Stock and Lisa Perrotti-Brown in California, Anders Enquiest in Sweden, Wilfred Wong in San Francisco and André Kunz in Switzerland. This shows the wine's global reach. It's a genuine collectable and a triumph for chief winemaker Peter Gago and his team. The accolades can only enhance Australia's reputation abroad as a producer of high-quality wine - with a halo effect for our food, especially beef. Master of Wine Andrew Caillard, the author of The Australian Ark, The Story of Australian Wine from 1788 to the Modern Era, gave the Grange 98 points. 'In the end it is a lovely wine that exemplifies the character, beauty and potential longevity of Grange,' he told me. Penfolds Grange has appeared every year since 1951 and is routinely released as a four-year-old. The vintage of Penfolds Grange released today is therefore the 2021. In South Australia it carries the official Heritage Icon status. The Grange sits at the top of an exceptional 24 wines from Australia, the US, France and China that will be publicly available from August 7. And there was an exciting newcomer on the Penfolds hit parade this year. It was made in Bordeaux as part of Penfolds French winemaking trials. Penfolds 2022 FWT 543 Cabernet Sauvignon Syrah ($100) is a union of cabernet sauvignon and shiraz is deeply woven into the Penfolds story, Mr Gago said. The blend defines some of the winemakers' most notable wines, including Bin 389, Bin 600, and the limited release Bin 180 made to celebrate Penfolds 180 years, and Superblend 802 A and Superblend 802 B. 'It works. Using a 65-year-old Bin 389 style template, the immediate acceptance of the inaugural 2018 Bin 600 Cabernet Sauvignon Shiraz from California – championed by winemakers, Steph Dutton and Andrew Balwin – emboldened our French team,' Mr Gago said. 'Not to be outdone, winemaker Shauna Bastow has propelled a French trialling first, the 2022 FWT 543 Cabernet Sauvignon Syrah, into this collection. 'Over time, and with brave sourcing and winemaking ambition, we await its ascent to Bin status.' It is a sumptuous blend containing 52 percent cabernet sauvignon and 48 percent syrah (shiraz). I scored it 97 points. The Grange overshadows some of the other outstanding wines in this collection, especially the Penfolds 2023 Bin 707 Cabernet Sauvignon ($800). I scored it 97 points. It is a multi-regional blend with fruit sourced from McLaren Vale, Padthaway and the Barossa Valley, and was matured in new American oak hogsheads for 18 months. This is an immaculate wine with gorgeous florals, blackcurrants, cherry, tobacco and pepper aromas ahead of a multi-layered palate with more cherry and blackcurrant plus mulberry, spiced plum and a hint of dark chocolate. I gave 96 points to Penfolds Bin 150 Marananga Shiraz 2023 ($100) described by Penfolds winemaker Shavaughn Wells as 'a bold, full bodied shiraz expression with structured tannins and a bright acidity'. It has a panoply of aromas and flavours from charred meats and olive tapenade to sweet plums and chocolate all framed with a mix of new and old French and American oak. Some others include Penfolds Bin 28 Shiraz 2023 ($50) which scored 94 points and has a ripe and generous warm climate of Australian shiraz. Age Worthy. There's the Penfolds Bin 389 Cabernet Sauvignon Shiraz 2023 ($120, 95 points). It's a multi-regional blend exemplifying Penfolds' 'house style' with opulent fruit matured in American oak. Penfolds St Henri Shiraz 2022 ($135.) Points 97. A classic. Perfect colour. Plush and rich. Minimal oak. The wine the winemakers drink. Max Schubert made the first experimental Grange in 1951. John Davoren followed suit with St Henri in 1953. Winemaker Steph Dutton says this vintage will gain soft, earthy, mocha-like characters as it ages. Penfolds Magill Estate Shiraz 2023 ($180) Points 96. A true monopole. Fruit from the original estate established in 1844 just 8km from the Adelaide GPO. Matured in the same wax-lined open fermenters Max Schubert once used to craft Grange. Black fruits, savoury tannins. A juicy, savoury complexity. Penfolds RWT Bin 798 Barossa Valley Shiraz 2023 ($220). Points 96. A contemporary expression of Barossa Shiraz in contrast to the more muscular Grange. Aromas of blueberries and mulberries billow from the glass. A subtle floral note of violets emerges intermingled with cedar and sandalwood. Tasting notes speak of plummy black fruits, pepper spices, cherry-infused chocolate and a hint of cola. From the third vintage of the China wine trials comes Penfolds CWT521 Cabernet Sauvignon Marselan 2023 ($150) Points 94. The blend 89 per cent cabernet sauvignon from the high-altitude vineyards of Shangri-La and 11 per cent marselan from Ningxia. The marselan grape is a crossing of cabernet sauvignon and grenache. In autumn the vines are buried to protect them from the harsh winters. Penfolds Yattarna Bin 144 Chardonnay 2023 ($220). I gave it 98 points; the same score I gave the Grange in this column last week. A monumental wine with superb fruit complexity. Our answer to white Burgundy. Yattarna is the winery's flagship white made by senior winemaker Kym Schroeter with fruit from three states. From White Hill and the Coal River valley in Tasmania, Tumbarumba in the NSW high country and the Adelaide Hills in South Australia.
Sky News AU
24-07-2025
- Sky News AU
'Peter Gago's troubleshooter': New Penfolds Director of Winemaking Steph Dutton reveals her priorities across the company's global empire
Introducing Steph Dutton, the new director of winemaking at Penfolds, Australia's greatest wine company. The 39-year-old Melbourne Girls Grammar old girl answers to Peter Gago, the legendary Penfolds chief winemaker who led the vintner's audacious push into US, China and France. The arrival of Penfolds as a global winemaking powerhouse is on show with its new Australian releases where local treasures like Grange, RWT and Bin 389 compete with vintages from the other side of the globe. Under the guidance of Gago and Dutton, Penfolds now manicures a universal vineyard straddling the two hemispheres. At any time in either the Barossa, Coonawarra, Coal River or Napa valleys or at Ningxia in the aptly named Shangri-La vineyards in China, or further south in Yunnan near the Burma border, the grapes are ripening. Penfolds also has an ongoing collaboration with Champagne Thiénot and its holding company Treasury Wine Estates owns the Chianti winery Castello di Gabbiano in Tuscany (a pleasant 37-minute drive south of Florence) and more wineries at Marlborough in New Zealand. Dutton has emerged as Gago's troubleshooter across an impressive portfolio of properties that now includes Château Lanessan in Bordeaux. She says it is an honour for an Australia firm to take charge at the left bank Lanessan vineyard which has been owned by a succession of eight generations of the Bouteiller family. The 390ha of land in the Haut-Médoc appellation has 80ha under vine, she said. It produces cabernet sauvignon, merlot, and petit verdot. Dutton, a mother of two whose parents were advertising executives, climbed the ranks from senior winemaker to group winemaker before being named the director of winemaking. She and her husband Andrew 'Baldy' Baldwin, another gun winemaker at Penfolds, had six-month stints together directing operations at the Penfolds vineyards in Napa and at Paso Robles. They were on a steep learning curve, she said. 'Napa cabernet tannins are very different to Australian tannins for example, so getting to know which barrels were going to match which tannins in different regions is a challenge.' If there was a problem, it has resolved itself spectacularly in Penfolds Bin 704 Napa Valley Cabernet Sauvignon 2022, a sumptuous offering bottled after 16 months in French oak barriques. Dutton grasps the historical significance of the bold Bordeaux acquisitions and the equally brave push into China and California. Lanessan contains two chateaux, one derelict. TWA has just appointed French architects for a major restoration of the cellar door and winery. TWE has a second left bank winery 15 minutes away at Château Cambon la Pelouse at Macau on the road leading to Margaux and Pauillac. TWE purchased the property in 2019. Dutton sees room for expansion. She already had her masters in genetic science before completing her winemaking degree. So how does she keep the predominantly male winemakers in line? 'You can't. It's impossible to keep these guys in line,' she said. She modified her answer by saying she doesn't have to. 'The Southern hemisphere crew in Australia are pretty well established and know what they are doing. 'The big focus for me in the last couple of years is making sure we are authentically and highly skilled in the northern hemisphere as well.' Penfolds winemaker Shauna Bastow is now living permanently in Bordeaux guiding the experimental FWT (French Winemaking Trial) series, including the FWT 585, a cabernet, merlot, and petit verdot blend. However Dutton is the 'boots on the ground' winemaker in sites where the same variety of grapes produce different flavour profiles. 'As you know the art of blending is incredibly important for us at Penfolds,' she said. 'In France, we want flexibility to bring in little grower plots, both from our own vineyards and our grower network there _ just as we do in Australia. 'Our immediate priority is getting Chateau Lanessan in tip top shape.' Dutton says it is a personal goal to create another iconic wine from the Lanessan fruit. 'It might come next year, or it may take eight years. We are still doing the work.' She wants to plant another 20ha of vines at Lanessan while 'rejuvenating' 15ha of existing vines. As the flagship and luxury brand of TWE, Dutton says Penfolds aspires to be the 'best of the best'. 'The combination of a grower network and owned fruit gives you more blending opportunities and options,' she said. 'And it is a little bit of an insurance policy in sourcing from vintage to vintage. We are still finding our feet.' 'We have trials going all the time at Penfolds.' Some have begun in right bank territory and Penfolds is looking at syrah in the Northern Rhone Valley.' She and Baldy often sip chardonnay on Friday night. 'We have slightly different tastes. Baldy does love the softer more voluptuous chardonnays while I tend to look for some of the racier styles. There are some that race across the palate and some that expand across the palate and the best examples do a little both of both.' And if you ask a Penfolds winemaker for their favourite wines they will probably nominate three or four, she said. St Henri will invariably be among them. 'For me, St Henri is an example of a highly saturated wine, full in body but still elegant,' Ms Dutton said. It is often described as a counterpoint to Grange because it shows little, if any, oak. Penfolds St Henri Shiraz 2022 has a commanding bouquet of black fruits, plum and licorice leading to a richly layered palate. It will gain soft, mocha-like characters with age. Penfolds Grange 2021 is another blending masterclass that will have the serious collectors queuing up. Grange doesn't get much better than this. I scored it 98 points. There is a remarkable synergy from grapes harvested in the Barossa Valley (66 percent), McLaren Vale (26) and Clare Valley (eight). This year's edition has six percent cabernet sauvignon. Mr Gago's tasting notes described it best: 'A vortex of mid-palate sumptuousness flanked by sleek, dusty tannins and chocolatey brûléed-suggestive oak.' Where did the flavour come from? Perhaps the Clare delivered Dutch liquorice and menthol, he muses. The Barossa berries contributed the dark satsuma plum, star anise and roasted quince notes while the Worcestershire sauce, squid ink, corned beef and peppercorn notes were delivered from McLaren Vale fruit. The wine was matured for 18 months in American oak hogsheads. (100 percent new) - More reviews next week.
