Treasury Wine Estates will not hold fire sales to offload underperforming labels. The group recently raised 50 million Australian dollars by selling three commercial brands to AG Oatley Wines.

That deal returns Rosemount, Ingoldby and Secret Stone to the founding Oatley family. Southcorp bought Rosemount for 1.5 billion Australian dollars a quarter of a century ago.

Chairman John Mullen told shareholders at the annual general meeting in Melbourne that the business will protect balance sheet value rather than rush disposals. Chief executive Sam Fischer plans to shrink the brand lineup from 75 to about 35 names. He also aims to extract 100 million Australian dollars in annual cost savings by fiscal 2029.

Trading stayed positive across the opening months of the fiscal year, driven by the luxury Penfolds division. Premium bottles generate the bulk of earnings across Asian distribution channels. Demand for heritage labels remains steadier than for budget supermarket lines.

Shedding lower-margin labels frees working capital tied up in grape intake, barrel storage and bottling runs. Fischer took the top job with a remit to streamline operational units bloated by decades of regional winery acquisitions.

Distributors across Asia have cut shelf space for mid-tier Australian commercial wines over the past three years. Retail buyers in regional hubs prioritise high-margin status bottlings over volume table wines. That preference leaves operators with excess inventory across lower price bands.

Rival producers face identical inventory overhangs across Oceania and Southeast Asia. Many have responded by heavily discounting stock or idling crushing plants. Those moves eroded wholesale price floors across the region.

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