Treasury Wine Estates (TWE) Investor Update summary

Strategic Outlook and Growth Plans

• Multi-year growth outlook targets Penfolds EBITS growth of ~15% in FY24, low double-digit in FY25, and ~15% annually in FY26 and FY27, with a return to a 45% margin in FY26-27.

• Price increases of 6% for Bin and Icon wines effective July 1, 2024, applied globally, with future increases dependent on wine availability.

• Record 2024 vintage intake supports significant step-up in availability from 2H FY26, enabled by vineyard and supply chain investments.

• FY25 will see increased investment in China (AUD 20m) for brand building and team expansion ahead of higher wine availability.

• Growth strategy emphasizes maintaining diversified global distribution and revenue, not shifting focus solely to China.

China Market Execution and Brand Positioning

• Ambition is to be the number one luxury wine brand in China, leveraging strong brand health and consumer resonance.

• Distribution model refined for efficiency, with select national and broad regional partners, and a focus on digital solutions.

• Local team expansion to ~200 people in FY25, mainly in sales and marketing, to support growth.

• Brand health remains strong, ranking #2 for awareness among imported wine brands in China, supported by continued A&P investment.

• Brand activations planned include refreshed campaigns, anniversary celebrations, and partnerships with key opinion leaders.

Portfolio, Supply, and Distribution

• Portfolio includes Australian, U.S., French, and Chinese wines, with a unique multi-country origin approach.

• Distribution model uses a mix of exclusive national and broad regional partners, tailored by geography and channel.

• Direct import model currently used for Australian wines, with bonded warehouse model for others; future adjustments possible.

• Asset base investments since 2018 have increased production capacity by 30%, supporting future growth.

• Allocation strategy prioritizes global growth markets, not just China, to maintain trust and brand equity.