Partial Franking and No DRP Discount Highlight Treasury Wine Estates’ Dividend Strategy

Dividend Announcement Overview

Treasury Wine Estates Limited (ASX: TWE) has declared an ordinary dividend of AUD 0.20 per fully paid ordinary share for the six months ending December 31, 2024. This announcement, made on February 13, 2025, signals the company’s ongoing commitment to returning value to shareholders amid a competitive consumer staples environment.

The dividend is partially franked at 70%, equating to AUD 0.14 per share in franking credits, with the remaining 30% unfranked but including a conduit foreign income component. This mix reflects the company’s international earnings and tax positioning, offering shareholders a meaningful tax benefit on their dividend income.

Key Dates and Payment Details

The ex-dividend date is set for March 5, 2025, with the record date following on March 6. Shareholders on the register by this date will be entitled to the dividend, which is scheduled for payment on April 2, 2025. The timing aligns with Treasury Wine Estates’ typical dividend schedule, providing predictability for investors.

Importantly, the company has confirmed that no external approvals, such as security holder or regulatory consents, are required for this dividend payment, underscoring the straightforward nature of this distribution.

Dividend Reinvestment Plan Details

Treasury Wine Estates offers a fully operational Dividend Reinvestment Plan (DRP) for this dividend, allowing shareholders to reinvest their dividends into additional shares without a discount. The DRP election deadline is March 7, 2025, at 5:00 pm, with the reinvestment price calculated as the average volume weighted price over a ten trading day period starting March 10.

The DRP is available exclusively to Australian resident shareholders holding a minimum of AUD 500 worth of shares at the record date. Notably, the company will not issue new shares for the DRP; instead, it will use existing shares, which may have implications for share liquidity and supply.

Context and Market Implications

This dividend announcement reflects Treasury Wine Estates’ stable cash flow generation and confidence in its business fundamentals despite ongoing global market uncertainties. The partial franking credits highlight the company’s effective tax management and international footprint.

Investors will be watching closely to see the uptake of the DRP, which can signal shareholder confidence and influence Treasury Wine Estates’ capital management strategy going forward. The absence of a DRP discount suggests the company is balancing shareholder value with capital efficiency.