Feb 10 (Reuters) – Australia’s Treasury Wine Estates said on Tuesday it had settled a dispute with its U.S. distributor, Republic National Distributing Company, over the closure of the California operations last September.
The winemaker also expects first‑half earnings before interest and taxes to be around A$236 million ($167.35 million), above its previous guidance of A$225 million – A$235 million.
Under the settlement with RNDC, Treasury Wine will repurchase Treasury Americas and Treasury Collective portfolio inventory held by RNDC in California for its original sale value, minus a confidential settlement amount that compensates the firm for the impact of the closure.
CEO Sam Fischer said RNDC’s California exit had significantly affected first-half performance. Treasury Wine said in June last year that RNDC planned to exit its California operations, while its distribution partnership across the remaining 24 U.S. states would remain unaffected.
Following RNDC’s planned divestment of several markets to Reyes Beverage Group, the distribution is expected to comprise less than 20% of Treasury Americas’ net sales revenue.
($1 = 1.4102 Australian dollars)
(Reporting by Kumar Tanishk in Bengaluru; Editing by Krishna Chandra Eluri)
