Treasury Wine Estates boss Michael Clarke will spend more time in the US as the Australian wine producer accelerates strong growth in the big US market and sets itself for a big push of its US brands into China.
TWE has a stable of well-known Australian brands include Penfolds, Wolf Blass, Wynn's and Lindeman's but the company also has big US brands obtained through the acquisition of Beringer Wine Estates in 2000 and the recent acquisition of Diageo wine business in January 2016.
They include 19 Crimes, Beaulieu Vineyard, Sterling, Beringer, Chateau St Jean, Etude and Stags' Leap.
TWE chief executive Michael Clarke said the company has been refreshing its US luxury and "masstige" wines - mass-market prestige above $US10 - not only for sale in the US but also for sale in Asia, especially China.
"As we move forward now, we're wanting to drive this business with even greater momentum," Mr Clarke said on Tuesday.
Treasury's focus on its US labels means that Mr Clarke will alternately spend one month in Melbourne and one month in California's Napa Valley from March 1 until at least the year's end.
TWE chief financial officer Gunther Burghardt will be based in Napa.
In its US brand push, TWE has changed the labels and bottles of its US wines, included the use of high-quality grapes from other regions and embarked upon extensive advertising.
TWE launched its "90-plus" collection of US wines - wines with a score of 90 points or more from critics - in Shanghai in November.
Mr Clarke said TWE had established its luxury and masstige Australian wines in China to compete with French and Italian wines, and was now doing the same thing with the US product.
Although there was no US wine with a similar reputation to the iconic Australian Penfolds label yet, TWE would be building up the Beaulieu Vineyard and Stags' Leap brands, Mr Clarke said.
"The fact that we're now driving three portfolios in China - the Penfolds portfolio, the rest-of-Australian portfolio, and also the American portfolio puts us in quite a strong position where we can make a broader offering to the retailers and distributors," Mr Clarke said.
Surging sales in the Americas and Asia helped TWE to more than double its first-half net profit to $136.2 million.
Earnings from TWE's Asian operations climbed 71 per cent on a constant currency basis in the six months to December 31, driven by higher sales of the Australian brands and the start of sales of the refreshed US portfolio.
Earnings grew by 88.6 per cent in the Americas, boosted by the Diageo contribution and more promotional spending.
TWE shares closed 56 cents, or 4.7 per cent, lower at $11.33.
IG chief market strategist Chris Weston said TWE's result and outlook were good, but the stock was highly priced before the announcement of the results.
US, ASIA BOOST TREASURY PROFIT
* Net profit up 132.4pct to $136.2m
* Revenue up 20.2pct to $1.37bn
* Interim dividend up 5.0 cents to 13.0 cents, unfranked
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