News: TWE UPDATE 1-Australia's Treasury Wine warns of earnings plunge as virus hits demand

(Adds details on earnings drop, regional performance and CEO comment)

July 9 (Reuters) - Treasury Wine Estates Ltd (TWE) on Thursday slashed expectations for core earnings in 2020 and withheld guidance for fiscal 2021, as the coronavirus outbreak and travel restrictions hurts demand for the winemaker's products.

The owner of the Penfolds wine label said core earnings had plunged about 21% compared with adjusted year-ago figures, with earnings declining about 14% in Asia, 37% in the Americas and 16% in Australia and New Zealand.

As a result, Treasury Wine said it now expected earnings before interest, tax, self-generating and regenerating assets (EBITS) of between A$530 million ($370 million) and A$540 million.

The company sounded a warning in February, saying it did not expect to meet an already steeply lowered expectation of EBITS growth of 5% to 10% issued in January.

The winemaker said it saw positive signs in Chinese markets as the country reopened, but it remained cautious as gatherings and social occasions, the driver of luxury wine consumption, were yet to fully recover.

"While it is right to remain cautious on the near-term outlook, given uncertainty remains around the timing and pace of recovery in our key markets, we remain optimistic around our return to both margin and profit growth," Chief Executive Officer Tim Ford said in a statement.

The company said that it had completed implementation of various cost saving measures, and added that recent work validated its view of a separate focus for Penfolds from its other brands, including a potential demerger.

It is set to release full-year results on Aug 13.

($1 = 1.4325 Australian dollars)