Dear Client:
After issuing a trade hold notice earlier this week, Treasury Wine Estates (TWE) held its previously-announced performance update yesterday evening, giving investors a look under the hood at what exactly is going on at the Australian wine giant.
It’s been a rough year for TWE (as it has been for many others as well). Recall, the company pulled back its fiscal year 2026 guidance in October, citing struggles in the US and China markets. A big factor in the US difficulties was Republic National Distributing Co.’s (RNDC) departure from California [see WSD 10-13-2025]. Then, earlier this month, TWE took a $450 million write-down on its US business, pointing to similar factors and the slowing of US wine trends [see WSD 12-01-2025].
This was the first market update from newly-appointed TWE ceo Sam Fischer, who officially took on the role October 27. While he admitted this wasn’t the first update he expected to make, it is “one that is critical to ensure that we maintain the ongoing strength of our brands and the health of our sales channels as we navigate what is a challenging environment for the global alcohol category and the wine industry more specifically,” Sam opened on yesterday’s call.
The discussion delved further into how TWE’s issues have persisted as well as their plans to right-size the business as a whole. Read on.
CALIFORNIA MARKET WEIGHING DOWN TREASURY AMERICAS. Treasury Americas’ depletions were down 4.6% for the fiscal year-to-date through November 2025. US results were weighed down by a slow November in California that was further exacerbated by distribution changes following RNDC’s exit. However, Sam highlighted, US depletions are up 2.3% in markets outside of California.
TWE distributor inventory holdings outside of California are still “above optimal levels” by 300,000 cases, noted Sam. That excess will take about two years to work through, starting in the second half of fiscal 2026.
Meanwhile, Treasury Americas is still in negotiations with RNDC over remaining inventory and exit arrangements in California. However, the result of those negotiations should not affect the previously-disclosed impact on net sales revenues of about 100 million AUD (about $66 million) related to remaining inventory.
In addition, “due to the revised shipment profile,” synergies from the Daou acquisition will also be impacted, with run-rate benefit in fiscal ’26 coming out to about $20 million, down from previous forecasts of $30 million, per release.
Overall, EBITS for Treasury Americas is expected to be around $26.4 million for the first half of fiscal 2026, with EBITS improvement expected in H2.
TREASURY COLLECTIVE ALSO HAMPERED BY US IMPACT. The Treasury Collective business– while performing “in line with expectations” in Australia and EMEA (Europe, Middle East and Africa)– is also underperforming in the US market, said Sam.
Specifically, the Treasury Collective portfolio underperformed the US premium wine market in the latest 26 weeks through November (with sales down 13.7% vs. the category at -6.6% in Circana MULO+C for the period). Brand-wise, the segment’s US business is seeing the largest decline impact from 19 Crimes (sales down 16.8% for the same Circana 26-week period) and Cali by Snoop (sales down 21.2%), with results only partially offset by Matua (up 4.8%).
The segment was also impacted by the California distribution transition and their focus on “aligning shipments to depletions” from F25 to F26. So far, they’ve reduced 200,000 cases of distributor inventory in the first half of F26, per release.
US tariffs on Australian and New Zealand wines are expected to impact Treasury Collective EBITS by about $6.6 million, “net of planned pricing actions, which are now expected to be insignificant to cover the full impact,” said Sam.
TWE ASCENT. Similar to other large wine and spirits conglomerates, TWE announced its own multi-year turnaround plan, called “TWE Ascent.” The new program aims to reap material cost benefits of about $66 million per year over a two-to-three year period.
Specifically, the plan addresses three primary “pillars”:
- Portfolio evolution – continued focus on luxury brands like Penfolds, Daou and Frank Family; looking for growth opportunities aligned with consumer trends like “lighter varietals and refreshment styles;” and “redirecting resources to strengthen” TWE’s position in high-growth segments, said Sam.
- Operating model transformation – restructuring their operating model to “to deliver flawless in-market execution and unlock enhanced global innovation capability and increased operational consistency,” he continued.
- Operating cost optimization – increasing automation and data and analytics capabilities while removing redundancies in operational processes “to drive margin, mitigate impacts of portfolio rationalization, and create funds for investing in growth,” Sam added.
TWE plans to provide updates on the new Ascent program at the F26 half-year results report in February, with full details outlined by the end of F26.
WINE PULLS BACK MORE THAN EXPECTED IN POST-THANKSGIVING SCANS
As expected there was some post-Thanksgiving retracement in scan data, with total bev alc sales down 23% for the week ended December 7 compared to the previous week (which included the Thanksgiving holiday), per Circana. Total sales were down 2% for the week compared to the same period a year ago.
“Post Thanksgiving we expected some retracement, unfortunately wine pulled back a bit more than expected with beer and spirits relatively in line,” writes Circana’s Scott Scanlon in this week’s report.
For the latest week, wine sales were down 5% compared to the same period a year ago, while beer sales were down 2%, spirits were up 3% and RTDs were up 6%.
Looking ahead, “hoping we will see a bit more brand growth within the wine category in the coming weeks heading into the holidays,” Scott writes, adding, “based on what we have seen in 2025 post holidays the data could retrace a bit more in the coming week or two in advance of Christmas.”
WSD BRIEFS:
REMY MARTIN LAUNCHES NEW CAMPAIGN. The House of Remy Martin announced yesterday the launch of “My Call,” a new brand vision and global campaign. The campaign “spotlights the power of personal choice and the deeply individual way people pursue and honor their milestones,” per release. “This campaign is about honoring the choices, the process, and the personal conviction behind how modern success is shaped,” says Tonia Mancino, Remy Cointreau Americas vp of luxury brands. “That same ethos has guided Remy Martin for centuries, reflected in the care and expertise behind our expertly crafted Cognac.” Remy will partner with Hypebeast to launch a 360-degree content-driven campaign, which will spotlight a diverse collective of multidisciplinary creators throughout the year.
SHAW-ROSS EXPANDS JAPANESE SPIRITS PORTFOLIO WITH TENJAKU WHISKY USA. Shaw-Ross International Importers announced yesterday it will become the exclusive US distributor for Tenjaku Whisky USA, effective January 1. The portfolio includes Tenjaku Japanese Pure Malt Whisky (srp $70), Tenjaku Japanese Blended Whisky (srp $40), Tenjaku Japanese Gin (srp $30), and Tenjaku Japanese Vodka (srp $30). “Shaw-Ross is excited to partner with Tenjaku Whisky USA to help strengthen and expand their already fast-growing presence in the US,” says Shaw-Ross president Scott Jove. “We look forward to working closely with the Tenjaku team to broaden the reach of their thoughtfully crafted whisky, vodka, and gin for US consumers.” The partnership also “enables the scalability” that the Tenjaku portfolio “needs,” adds Tenjaku USA managing director Craig Kodish.
STOLI LAUNCHES HALAPENO PEPPER VODKA. Stoli Group announced this week the global launch of Stoli Halapeño Pepper flavored vodka. This marks the company’s first Stoli product produced and bottled at Stoli Group-owned Louisiana Spirits. “With demand for spicy cocktails rising, and brunch culture, Stoli Halapeño Pepper was developed specifically to be the definitive spicy vodka for a next-level Bloody Mary,” says Stoli Group cmo Marina Troyanovskaya. They’re also partnering with premix brand Mr & Mrs T in the US on a series of promotional initiatives, and starting in January will roll out the Stoli Halapeño Pepper 1L + Mr & Mrs T Original Bloody Mary Mix 1L.
THE SUMMIT AGENDA IS LIVE! That’s right folks, the full schedule for the Beer, Wine & Spirits Summit is now live. The Summit is taking place January 18-20, 2026 at the Hotel Del Coronado in San Diego, CA. You’ll hear from execs across tiers, including Dogfish Head, Circle K, Constellation Brands, Stateside Brands, Instacart, Hyatt, Southern Glazer’s Wine & Spirits, Breakthru Beverage Group, and many more. You can register and learn more here. And don’t forget to book your hotel! Room block ends December 21.
Until tomorrow,
Your editors
Sarah Barrett, Executive Editor
Hana Kruger, Editor
“I learned the value of hard work by working hard.” – Margaret Mead
——- Sell Day Calendar ———
Today’s Sell Day: 13
Sell days this month: 22
Sell days this month last year: 21
This month ends on a: Wed.
This month last year ended on a: Tues.
YTD sell days Over/Under:-1
