Treasury Wine Estates has announced its net profit after tax for the 2019 financial year has risen 16% to $419.5m.

The company said premiumisation was a key driver of its performance, with net sales revenue (NSR) from luxury and masstige segments growing 27% in 2018-19, which now represent 69% of the group’s NSR.

“Today’s results confirm the positive momentum in our business which is being delivered through our premiumisation strategy, the disciplined investments we have made in our business over recent years and importantly, exceptional execution by our global team,” said TWE’s chief executive Michael Clarke in the company’s annoucement to the ASX. “While the competitive and macro-economic landscape has presented challenges for the industry in some of our key growth markets, our competitively advantaged business models and collaborative customer partnerships have enabled TWE to continue delivering strong underlying growth.”

As noted in the ASX announcement, key regional highlights for the company in 2018-19 include:

• 13% growth in EBITS¹ in the Americas to $218.7m following successful embedding of route-to-market changes and investment in the US. Premiumisation continues to be a key driver of performance, with increased luxury and masstige volumes complemented by growth in Canada and Latin America
• 43% growth in EBITS¹ from Asia to $293.5m, driven by the increased availability of luxury and masstige wine and growing demand for TWE’s portfolio of brands. The company said it was continuing to invest in driving distribution, brand building and organisational capability throughout the region to support future growth
• 15% growth in EBITS¹ from Australia & New Zealand to $156.5m, driven by growth across the masstige and lower luxury portfolios, improving performance in the on-premise channel and an ongoing focus on managing costs
• 4% growth in EBITS from Europe to $51.4m, driven by targeted investment behind priority brands in focus markets throughout the region.

The company said it was well placed to continue the successful execution of its premiumisation strategy in 2019-20 and beyond, with the 2019 Australian vintage representing “another outstanding” luxury intake for TWE, and its investments in French production assets and Australian luxury winemaking capacity supporting the next phase of its “premiumisation journey”.

“Further strengthening of the company’s competitively advantaged route-to-market remains a priority, particularly in the US and Asia, both of which remain attractive markets for premium wine consumption and where TWE sees significant opportunity to continue growing a focused portfolio of brands,” the announcement said.

¹Earnings before interest, tax, SGARA and material items