Drastic UK volume decline for Treasury Wine given positive spin
A drastic 1.6 million case decline in the United Kingdom has been given positive spin as Treasury Wine Estates briefed the Australian Securities Exchange on their 2012 full year results.
TWE senior staff, including David Dearie, chief executive and Mark Fleming, chief financial officer, have both cited outcomes as "very pleasing" with Fleming commenting that "crucial investments" have been made to underpin growth of the company, which will keep it in good stead for financial years 2013, 2014 and beyond.
While Australian wine from TWE has seen a heady decline in case numbers into the United Kingdom, Dearie has said these were "unprofitable cases", and that TWE are refocusing on building brands on quality products, rather than volume.
Dearie affirmed that "interesting growth" has been occurring in the Luxury (AUD$20/GBP £13) and Masstige (AUD$10-AUD$20/GBP £6.50-£13) categories for the business, coupled with successes of unique super premium releases.
These super premium releases have included 2008 Penfold's Bin 620, which was launched in Shanghai earlier this year at AUD$1,000 (GBP £664) per bottle, and has subsequently sold out, with the United Kingdom being the first country to sell all regionally allocated wine available.
The Penfold's ‘Ampoule' project, a US$168,000 (GBP £107,000) per bottle, limited release wine-and-art-sculpture (12 units produced), has seen eleven of the units sold around the world, with the remaining ampoule being kept by Penfold's winery in Australia.
The first Penfold's Ampoule to go on public display has been revealed at newly-opened London wine retailer Hedonism in Mayfair.
The UK market is also set to be a testing ground for TWE's Project Uplift, which will see a reinvestment in superior production, increased quality of grape growing, and subsequent releases and relaunching of premium wines into multiple markets.
TWE wine price increases will also be seen in the UK, with Dearie confirming that rises will be to balance global pricing, suggesting brands at a more premium price point will be able to take increases more easily.
There will be several new releases and reinvigorations of existing brands slated to occur before the end of the calendar year, including a campaign to highlight Wolf Blass premium ranges, Matua Valley (New Zealand) packaging update promotions and the launch of Lindeman's Early Harvest, a category-leading lower alcohol, full flavoured, low carbohydrate wine range.