Treasury Wine Estates Limited · ASX:TWE
Treasury Wine Estates — H1 FY2025 Earnings Presentation
30 slides from Treasury Wine Estates's earnings presentation, Feb 13, 2025
Slide 1: 2025 Interim Results Investor and Analyst Presentation
13 February 2025 ASX ANNOUNCEMENT 2025 Interim Results Investor and Analyst Presentation Enclosed are the presentation materials for the investor and analyst webcast and conference call to be hosted by Treasury Wine Estates commencing at 10:00am (AEDT) on 13 February 2025. Links to register for the
Slide 2: F25 Interim Results
F25 Interim Results 13 FEBRUARY 2025
Slide 3: Important information
Important information This presentation is in summary form and is not necessarily complete. It should be read together with the Company’s Annual Report for 30 June 2024, the Appendix 4D and 2025 Interim Results, and other announcements lodged with the Australian Securities Exchange, which are availa
Slide 4: Introduction
Introduction Tim Ford Chief Executive Officer
Slide 5: Key Messages
Key Messages1 • TWE’s Luxury-led focus delivers strong performance in 1H25, with growth for Penfolds and the contribution from DAOU in Treasury Americas partly offset by lower shipments in Treasury Premium Brands: – EBITS grew 35.1% to $391.4m and EBITS margin increased 2.8ppts to 25.3% – Luxury NSR
Slide 6: 1H25 Financial Highlights
1H25 Financial Highlights1,2,3 Financial performance reflects quality of earnings and strengthened metrics from the Luxury-led focus NSR EBITS NPAT $1.5bn 20.2% reported $391.4m 35.1% $239.6m 31.5% 5.1% organic4 NSR per case EBITS margin EPS $137.5 16.1% 25.3% 2.8 ppts 29.5cps 20.1% Cash conversion
Slide 7: 1H25 Divisional performance
1H25 Divisional performance Topline growth driven by Penfolds and DAOU % Metric1, 2 1H25 % pcp % CFX 1H25 % pcp % CFX 1H25 % pcp % CFX Organic3 NSR (A$m) 557.4 24.4% 24.2% 631.1 41.0% 42.2% (1.5)% 355.7 (8.4)% (8.6)% NSR per case (A$) 373.0 10.6% 10.5% 184.0 15.5% 16.5% 0.9% 56.4 (2.6)% (2.8)% EBITS
Slide 8: Financial Performance
Financial Performance Chief Financial and Strategy Officer Stuart Boxer Chief Financial and Strategy Officer
Slide 9: Key measures of performance
Key measures of performance1 Group NSR (A$m) and NSR per case Group EBITS (A$m) and EBITS margin 137.5 25.3% 118.4 108.6 23.9% 95.6 22.6% 82.5 391.4 20.7% 19.9% 1,544.2 1,411.0 307.5 281.2 289.8 1,267.0 1,284.5 1,284.3 262.4 37% 56% 39% 42% 44% 38% 44% 43% 42% 33% 25% 17% 15% 14% 11% 1H21 1H22 1H23
Slide 10: Material items
Material items Projected non- Recognised prior Recognised in Total projected Projected cash Material Items (A$m) cash Status to 1H25 1H25 one-off cost component component Treasury Premium Brands operating To complete in 2H25; model and Australian Commercial wine (113.9) 7.5 (90.0)1 (25.0) (65.0) pen
Slide 11: Balance sheet
Balance sheet1,2 1H25 F24 1H243 A$m 31-Dec-24 30-Jun-24 31-Dec-23 Cash & cash equivalents 474.7 458.1 436.4 • Net assets increased $263.4m to $4,874.3m at 31 December Receivables 785.4 694.9 737.5 2024. Adjusting for foreign currency movements, net assets Current inventory 1,094.5 1,020.5 1,059.7 in
Slide 12: Inventory analysis
Inventory analysis Inventory at book value split by price segment1,2,3 $1,094.5m $1,059.7m $1,288.2m $1,221.3m $2,382.7m $2,281.0m • Total inventory volume decreased 15% versus the pcp reflecting reduced Commercial and Premium portfolio inventory Total Luxury • Total inventory value increased 4%: 53
Slide 13: Cash flow and net debt
Cash flow and net debt1 A$m (unless otherwise stated) 1H25 1H243 EBITDAS 473.1 364.6 Change in working capital (36.6) (93.3) • Net operating cash flow grew 56.0% and cash conversion Other items (8.7) 2.9 was 90.4% in 1H25: Net operating cash flows before financing costs, tax & material items 427.8 2
Slide 14: Capital expenditure
Capital expenditure A$m 1H25 1H24 Wine making equipment and facilities 19.1 19.6 • Capital expenditure (capex) of $78.0m in 1H25: – Maintenance & replacement capex of $53.2m, Vineyard redevelopments 9.8 14.8 including focus on ongoing upgrades to wine making Sustainability 10.5 2.0 equipment and fac
Slide 15: Capital management
Capital management Debt maturity profile • TWE’s investment grade capital structure remains A$m efficient and flexible: 600 USPP Notes Asian Term Loan - Net debt / EBITDAS1 2.0x at 1H25 (unchanged), Drawn Bilateral Facilities impacted by adverse foreign currency movements Undrawn Bilateral Facilitie
Slide 16: Divisional Performance
Divisional Performance Tom King Managing Director, Penfolds Ben Dollard President, Treasury Americas Angus Lilley Managing Director, Treasury Premium Brands
Slide 17: Penfolds
Penfolds Continued positive momentum in Asia led by re-establishment of Australian COO portfolio in China Performance summary1 Reported Currency Constant Currency • EBITS increased 33.3% and EBITS margin increased 3.0ppts to 44.9%: 1H25 1H24 % 1H24 % – Strong growth of Bin & Icon portfolio in Asia,
Slide 18: Penfolds in China
Penfolds in China An encouraging return to China for Penfolds Australian COO portfolio Market • Alcoholic beverage market conditions are mixed, with wine seeing some improvement in 1H25 conditions • China wine category value growth in 1H25 versus pcp: offline retail +2% 1, e-commerce +6%2 • Luxury w
Slide 19: Penfolds
Penfolds Scaling Luxury credentials to recruit and re- Optimising the portfolio for long-term growth recruit consumers The launch of Penfolds Holiday by Nigo campaign The acquisition of Ningxia Stone & Moon Winery, expected to close in 2H25, cements TWE’s was well received in Australia, driving stro
Slide 20: Treasury Americas
Treasury Americas DAOU drives top-line growth in 1H25, with organic NSR stable Reported Currency Constant Currency Performance summary1 1H25 1H24 % 1H24 % • EBITS increased 69.8% and EBITS margin increased 4.0ppts to Volume (m 9Le) 3.4 2.8 22.1% 2.8 22.1% 24.6%: 631.1 447.7 41.0% 443.7 42.2% – Drive
Slide 21: Treasury Americas
Treasury Americas Scaling our Estate-led brands while elevating our Luxury image After the first three years as part of Treasury Americas, DAOU’s NSR grew 11.2% in 1H252, in line with expectations. Business integration is Frank Family Vineyards is firmly on track to deliver its progressing to plan,
Slide 22: Treasury Premium Brands
Treasury Premium Brands Commercial and Premium portfolio declines drive lower EBITS delivery Reported Currency Constant Currency Performance summary1 A$m 1H25 1H24 % 1H24 % • EBITS declined 48.9% and EBITS margin declined 5.1ppts to 6.4%: Volume (m 9Le) 6.3 6.7 (6.0)% 6.7 (6.0)% – Commercial and Pre
Slide 23: Treasury Premium Brands
Treasury Premium Brands Building powerful lifestyle brands of meaningful scale Optimising the portfolio, process and cost base Squealing Pig delivered global double digit NSR growth in 1H25 while Progressed planning for transition to the global Premium division, with continuing to innovate to meet c
Slide 24: Outlook
Outlook Tim Ford Chief Executive Officer
Slide 25: Summary and outlook
Summary and outlook • In 1H25, TWE’s Luxury-led focus drove the delivery of NSR, EBITS and EBITS margin growth • The re-establishment of Penfolds Australian COO portfolio in China is progressing in line with expectations, supported by strong customer demand and encouraging depletions performance thr
Slide 26: Questions
Questions
Slide 27: Supplementary Information
Ee et Supplementary Information
Slide 28: Impact of foreign exchange and hedging
Impact of foreign exchange and hedging 1H25 EBITS constant currency impact 2H25 EBITS sensitivity and risk management CFX Impact (A$m) EBITS Currency Pair Primary Exposure Movement Currency Underlying Hedging 1 Total Sensitivity (A$m) AUD/USD and AUD/GBP 1.7 (0.3) 1.4 AUD/USD COGS, EBITS + 1% (2.2)
Slide 29: Reconciliation of key performance measures
Reconciliation of key performance measures Metric (A$m unless Management calculation 1H25 1H24 otherwise stated) Net Profit After Tax 220.9 166.7 Profit / (loss) attributable to non-controlling interests (0.3) 0.1 Statutory net profit 220.6 166.8 Income tax expense 101.4 60.0 EBITS Net finance costs
Slide 30: Definitions
Definitions 9Le 9 litre equivalent case Cash conversion* Net operating cash flows before financing costs, tax and material items divided by EBITDAS CFX Constant foreign exchange rates COO Country of origin CODB* Cost of doing business. Gross profit less EBITS. Excludes non-cash items as well as tax,
Treasury Wine Estates — H1 FY2025 Earnings Presentation on 6ix