By Mike Cherney
SYDNEY–Australian vintner Treasury Wine Estates Ltd. said after market close on Wednesday that its fiscal 2020 earnings could be impacted by the coronavirus outbreak in China, and that Chief Executive Michael Clarke would retire earlier than planned.
The company said it was too early to assess the financial impact of the virus outbreak that has sickened thousands of people in China, a key growth market for Treasury.
But it said that any sustained material impact on consumption would have an effect on fiscal 2020 earnings. It added that current guidance for earnings growth of 5% to 10% in fiscal 2020 doesn’t account for any potential impact from the outbreak.
The company also said Mr. Clarke would step down effective July 1, which will allow incoming CEO Tim Ford to take up the position for the full fiscal year. The company last year announced that Mr. Clarke would retire around October.
Treasury surprised investors on Jan. 28 by releasing fiscal first-half results earlier than planned. The company had said it missed its earnings target for the half year, which ended Dec. 31, and downgraded its full-year guidance. It blamed that on poor performance in the U.S., where the wine market has been weak and where there’d been unexpected changes in Treasury’s regional management.
On Wednesday, Treasury said its audited results for the half were “substantively unchanged” from the preliminary results released earlier. Statutory net profit was 211.4 million Australian dollars (US$142 million), a decrease of about 1% from the prior period. Stripping out one-time items, net profit was A$229.2 million, a rise of 5%.
Treasury shares are down nearly 30% since the Jan. 28 earnings results.
Write to Mike Cherney at [email protected]
(END) Dow Jones Newswires
February 12, 2020 03:11 ET (08:11 GMT)
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