The much-anticipated announcement by the US Government of reciprocal tariffs creates an environment of uncertainty. For Australian consumer companies, there could be a silver lining through lower cost of goods on products sourced from China or other low-cost countries. Breville and Lovisa face some challenges given their US operations, but also stand to benefit from lower sourcing costs. Treasury Wines will face tariffs on a small part of its business importing wines from NZ and Australia, but its US business could benefit from higher prices on French & Italian wines competing with its domestic US premium portfolio.

Breville reported 1H25 sales growth of 10% and EBIT growth of 11%. The result was characterised by strong sales across all geographies and particularly in coffee machines. We expect the company to sustain good sales growth, helped by a step-up in product development, marketing and the addition of new markets including China.