After A Challenging First Half, Treasury Ramps Up Activity On Core BrandsFebruary 28, 2013
With sales and profits at Treasury Wine Estates Americas down in its fiscal first half (ended December 31, 2012), and its high-end business hampered by supply constraints, managing director Sandra LeDrew tells Shanken News Daily that the company is ramping up activity behind core brands like Beringer, Lindemans and Chateau St. Jean.
“It’s been a challenging year so far, particularly with supply down on our luxury end, which has been a growth driver,” LeDrew said. “But when you look past the high-end business, our two biggest brands—Beringer Classics and Lindemans—performed well and outpaced their categories. And Chateau St. Jean achieved double-digit growth. In our second half, we’re rolling out major initiatives on all these brands.”
Beringer—which accounts for around half of Treasury’s U.S. volume—is set to unveil new labeling and a new marketing campaign centering on its “Unwind” tagline. Treasury is also extending the Beringer franchise with the launches of Quantum, a red blend firmly entrenched in the luxury segment, with a retail price of around $60; and Los Hermanos, a wine squarely targeting Hispanic consumers that’s being introduced in 10 metro markets.
Treasury Americas is also introducing new marketing campaigns for Lindemans and Chateau St. Jean, which grew by nearly 20% in calendar 2012, according to Impact Databank estimates. Singer Sheryl Crow will be the new face of Chateau St. Jean and will be featured in ads for the brand. There will also be tie-ins with the musician’s upcoming CD release and concert tour, LeDrew added.
Meanwhile, Treasury Americas should be receiving much-needed reinforcement in the supply-challenged luxury segment from the latest release of Penfolds Bins and Grange, rolling out this spring.
For its fiscal first half, Treasury Americas endured a 1.4% shipments decline and a 3.7% drop in depletions, while net sales fell by 3.2% to A$363.1 million ($371.7m).
Parent company Treasury Wine Estates, meanwhile, posted a 2.5% drop in volume, to 16.5 million cases, and a 3.3% decrease in net sales revenue, to A$816.9 million ($836.4m). However, the company’s better-than-expected net profit jump of 30.8% (largely the result of a material items adjustment related to Treasury’s acquisition of the outstanding 50% of New Zealand’s Matua Marlborough winery) and solid sales and profit growth in Asia propelled its share price upward in today’s trading on the Australian Stock Exchange. Treasury’s shares finished the day up more than 8%, to A$5.30 ($5.43).
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