Majestic Wine posts 4.1% uplift in festive sales

Sales across Majestic Wine PLC’s business increased by 4.1% year-on-year over the festive period, with the group generating 30% of its yearly sales in the 10 weeks to 1 January 2018.

CEO Rowan Gormley

Sales at Majestic Retail grew at a slower rate compared with the same period last year,  rising by 1.2% compared with 6.2% for the same period last year, with the group’s gross margin percentage broadly flat year-on-year.

“Subject to continued satisfactory trading, the group remains on track to achieve current market expectations and to accelerate sales growth in the medium term by increasing our investment in new customer acquisition,” Majestic said in a statement.

Naked Wines meanwhile continued to perform well, with sales up 13%, with its operations in the UK, USA and Australia delivering uplifts of 7.4%, 14% and 33.1% respectively.

Among the trends spotted by the group was a rising taste for English wine, which saw sales increase by 150% over the festive period. However Prosecco is still the driving force behind fizz sales, with Naked Wines selling 9.5 bottles of Prosecco for every bottle of Champagne sold over Christmas.

Sales of southern French white wines also grew 49% compared with last year, driven by “people looking for alternatives to more expensive Chablis and Rhone,” said Majestic. “Savvy shoppers honed in on previously unsung heroes like Viognier and Picpoul – which provide great value for money.”

Magnums also increased their presence this festive season, with sales increasing by 62%, while Eastern European wines also demonstrated their growing strength, with sales increasing by 190% in the run up to Christmas.

“Eastern European wines have been steady ships on the choppy waters of dismal European harvests and Brexit-related supply blues,” said Majestic. “Hungary’s harvest is down only 3% (compared to an EU-wide average drop of 14%), whilst Romania is looking at a 60% harvest increase. Your mid-week bottle may increasingly originate from Hungary’s Central Valley – rather than Chile’s.”

Less buoyant were sales within the group’s Majestic Commercial and fine wine arm, Lay & Wheeler, which saw sales decline by 4.6% and 4.7% respectively.

Overall, sales increased by 4.1% across the group in the 10 weeks to 1 January 2018.

“The team performed brilliantly. The fact that we have been able to grow sales and maintain margins shows that our winning formula of fabulous customer service from delightful people and delicious wines at fair prices works even when times are tough,” said Rowan Gormley, Majestic PLC chief executive.

Majestic also announced the appointment of Joshua Lincoln to the role of retail and managing director of Majestic Retail with immediate effect.

Lincoln has been customer director at Majestic Retail since 2016. Prior to this he oversaw sales and service in Naked Wines in the UK, USA and Australia.

“Josh’s promotion is richly deserved having transformed our store network into an entrepreneurial retail proposition during his time as customer director,” added Gormley.

“We are on track to achieve our £500m sales goal by 2019, on track to deliver market expectations for the current financial year, and on track to accelerate investment in new customers, new winemakers and more fantastic wines.”

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