SYDNEY--Treasury Wine Estates could consider quitting the U.S. after the Australian producer announced almost US$395 million in fresh impairments in response to global consumers' reduced appetite.

Treasury Wine, which had already started streamlining the California assets accumulated in a US$1.3 billion acquisition spree between 2021 and 2023, said it was continuing a strategic review of its operations in the country.

"The operational and strategic review of the Americas remains ongoing, with Treasury Wine having appointed advisors to support the review of all available options across the Americas brand portfolio, operating model and asset base," the ASX-listed producer said Monday.

Treasury Wine said it would immediately cut volumes and offload excess U.S. inventory through bulk channels. It had already flagged plans to sell some California wineries and consolidate production in an effort to reduce costs.

The latest move will incur a non-cash cost of 558.4 million Australian dollars, equivalent to US$394.7 million, and comes on top of the A$770.5 million impairment that dragged Treasury Wine to a A$649.4 million December-half statutory loss.

Treasury Wine, which produces Penfolds in Australia and operates U.S. brands including Daou and Frank Family Vineyards, will now recognize A$1.33 billion in U.S. asset impairments when it announces its annual results later this week.

"We are taking proactive and decisive action to align supply to a rigorous model of future demand against the backdrop of an evolving U.S. wine market," Chief Executive Sam Fischer said.

Treasury Wine had hoped that the California expansion under Fischer's predecessor would uncork elevated returns by capitalizing on a broader shift by consumers toward drinking higher quality wine.

However, global wine consumption has hit its lowest level since the 1960s, contributing to elevated inventory levels at Treasury Wine's wholesale customers. Its problems have been compounded by lower-than-expected demand from China for some of its Australian wines.

Excluding impairments, Treasury Wine said it expected to report earnings for the 12 months through June of A$492.3 million, compared with recent guidance of A$480 million-A$490 million. It still expects earnings to be at least flat across its current fiscal year, which began July 1.