By Sherin Sunny

(Reuters) - Australia's Treasury Wine Estates ( TSRYF ) posted nearly a 33% rise in first-half profit on Thursday, on growth in its luxury label Penfolds and higher contribution from DAOU vineyards, partly offset by weakness in Treasury Premium Brands.

The country's top winemaker is present in three price segments - luxury (more than A$30 per bottle), premium (between A$10 and A$30) and commercial (below A$10). Treasury Premium Brands houses its commercial and premium segments.

The company said Penfolds' performance was driven by strong Bin & Icon shipments to Asia, reflecting the re-establishment of the Australian Country of Origin portfolio in China. It remains confident in the long-term growth opportunity for Penfolds in China, which removed tariffs on Australian wine last year.

Its Treasury Americas division benefited from an increase in availability and strong growth in the DAOU brand, which was acquired in late in 2023.

Production and overhead cost synergies from the acquisition are now expected to be $35 million, up from its previous forecast of $20 million, with $30 million to be realised in FY26, it said.

However, strong performance in the Penfolds and Treasury Americas divisions was partly offset by lower commercial and premium shipments in Treasury Premium Brands.

The company said it does not intend to divest the commercial portfolio as "offers were not compelling".

"With the company deciding not to sell its commercial portfolio, TPB might be a drag on group earnings for some time," Citi said in a note.

The company forecast its fiscal 2025 EBITS at A$780 million ($489.84 million), which is at the lower end of its previously projected range, primarily driven by reduced expectations for Treasury Premium Brands.

Net profit after tax for six months ended December 31 was A$220.9 million, compared with A$166.7 million a year ago and the Alpha consensus estimate of A$241.6 million.

The Melbourne-based firm declared an interim dividend of 20 Australian cents per share, compared with the 17 Australian cents last year.

($1 = 1.5924 Australian dollars)