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LONDON (Alliance News) - Majestic Wine PLC on Wednesday reported an increase in sales over the Christmas period leading to renewed confidence in its annual earnings.
For the 10 weeks to December 31, the wine retailer said overall sales increased 6.3% on the prior year, led by a strong performance in the Naked Wines division.
The company's Retail arm had a "solid" performance over the period with sales up 1.5% despite a "challenging market backdrop".
"Retail, in common with the rest of the UK sector, encountered difficult trading conditions amidst economic uncertainty and weak consumer confidence. While sales were up 1.5%, gross margins were 1.2 percentage points lower year-on-year in a very price promotional market," Majestic Wine said.
The Naked Wines division saw overall sales up 16%, with US sales up 21%, UK 12% and Australia 15%.
The festive period is when Majestic Wine delivers around 30% of its annual sales; therefore, the positive performance reinforced the retailer's view that its annual pretax profit will be "broadly in line with current market consensus".
According to the company, analysts expect adjusted pretax profit to be between GBP11.0 million and GBP12.8 million. For the year ended April 2, the company posted adjusted pretax profit of GBP17.2 million.
Chief Executive Officer Rowan Gormley said: "As we said in November, consumer behaviour is changing and we're seeing a revolution in retail. We think there will be winners and losers, and we believe we have what it takes to be one of the winners. We are uniquely placed, with the people, data and skills in place to succeed despite the headwinds we are seeing."
Majestic Wine shares were trading up 1.6% at 254.00 pence each on Wednesday morning.
