But Maurice Blackburn alleges Treasury had problems in the Americas well before an earlier EBITS (earnings before interest, tax and the agricultural accounting standard SGARA) growth forecast was released in the middle of February 2019. “From at least June 30, 2018 to January 28, 2020, Treasury’s US performance was in decline, with diminishing sales, a weak US brand portfolio overall and slowing growth of its key brand 19 Crimes, added to which were unsustainable levels of inventory held by its distributors,” said Maurice Blackburn class actions principal Miranda Nagy.
“Treasury failed to disclose these problems. It also did not correct many representations from earlier years that it had ‘reset’ the US business in financial year 2015,” she said.
The lawsuit, expected to be lodged in the Victorian Supreme Court on Friday, is being led by the same firm behind an earlier class action against Treasury that was finalised in 2017, with a $49 million settlement for shareholders.
The lead plaintiff in the latest action, investor Steven Napier, slammed Treasury. “Investors are entitled to be informed about the health of the companies they are investing in. Treasury has betrayed those of us who in good faith put our money into the company. We deserve transparency and proper information to inform our decision making,” he said.
In a statement the company said: “Treasury Wine Estates has strong corporate governance practices and procedures in place that were used in our market update. TWE will vigorously defend any action.”
Early this month Treasury was hit with a class action led by law firm Slater and Gordon, which alleged the company had engaged in misleading or deceptive conduct and breached its continuous disclosure obligations to the market regarding its performance in the Americas. In response Treasury said it had strong governance procedures in place and would vigorously defend the action.
Treasury shares closed were up 4.2 per cent to $10.14.