Australia’s biggest wine company, Treasury Wine Estates, has issued a profit warning as much as 20% for its core earnings for fiscal year 2020 and withheld guidance for 2021 due to the coronavirus pandemic.
The company, owner of the popular Penfolds and Wolf Blass brands, said on Thursday that it expects 2020 core earnings to be between 18.5% to 20% lower than the previous year, according to Reuters, due to travel restrictions, social distancing measures installed by coronavirus outbreak globally.
The company also withheld guidance for fiscal 2021 citing continued uncertainty from the virus outbreak.
Its key markets in Asia and the US also saw profit drops in fiscal 2020, which will be released on August 13. It warns of profit drop about 14% in Asia, 37% in the Americas and 16% in Australia and New Zealand.
The company this year has twice adjusted its profit forecast, first on market dive in the US, then because of the outspread of coronavirus in its biggest market in China and other parts of Asia.
After adjusting its earning forecast from 10-15% down to 5-10% earlier this year, TWE said the forecast will no longer be achieved after it admits “consumption across discretionary categories in China has been significantly impacted,” as Vino Joy News previously reported.
This prompted two potential class action lawsuits for possible breaches of sharemarket disclosure laws after its shareholders alleged that they were misled by the company when it adjusted its financial guidelines early this year due to the spread of COVID-19.