Feb 16 (Reuters) - Australia's Treasury Wine Estates' first-half underlying profit nearly halved on Monday, and it temporarily suspended the distribution of its interim dividend to preserve cash and reduce leverage.
The result underscores a reset in its two largest markets after 2025 shipments ran ahead of underlying demand, while also being impacted from weaker drinking-led demand in the U.S. and China.
The firm reported a 46.3% slump in net profit after tax before material items and SGARA of A$128.5
million ($90.85 million) for the six months ended December 31, down from A$239.6 million a year ago.
That slightly beat the Visible Alpha consensus estimate of A$127.8 million.
Adding to concerns, one of Treasury Wine's U.S. distributors shut down in California, forcing a scramble for new partners and leading to a 28.4% drop in first-half net sales revenue at Treasury Americas to A$283 million.
The Melbourne-based company has been also tightening its belt as it works down customer inventory in the U.S. and China to match slower expected depletion growth, and significantly restrict shipments driving parallel imports in China to protect its Penfolds label.
It recognised a non-cash impairment charge of A$770.5 million post-tax on its U.S.-based assets, where shifting drinking habits have slowed sales.
The firm expects its earnings before interest, tax, SGARA and material items (EBITS) for the second half of fiscal 2026 to be higher than the first half.
($1 = 1.4144 Australian dollars)
(Reporting by Shivangi Lahiri and Sneha Kumar in Bengaluru; Editing by Matthew Lewis, Chris Reese and Alistair Bell)
