Cheerful Majestic Wine beats 'wettest summer on record' to announce rise in half-year profits
Majestic Wine has toasted a rise in half-year profits despite a hit from the “wettest summer on record” that led to the cancellation of barbecues and other events.
Chief executive Steve Lewis, pictured, said: “We really saw a lot of orders being placed and then stock coming back in soggy boxes.” He added that the rain had also forced organisers of outdoor and charity events to ship back wine marked for sale or return. Lewis said other countries had also suffered dire weather, hitting the international wine harvest by a quarter and by up to 50% in France’s Burgundy region.
Pre-tax profits grew 3.9% to £9.2 million in the half-year to October 1, boosted by a 0.6% rise in underlying sales and strong growth online, after it reduced the minimum purchase to six bottles from 12 on the internet.
While sales of champagne were flat over the half-year, demand for prosecco continues to grow, as cash-strapped consumers treat themselves to cheaper sparkling wines. Lewis said: “People are drinking prosecco not just for celebrating but also as a normal Friday night drink.”
Total sales at Majestic fell 1.4% to £126 million. This reflects a sharp fall in wholesale revenues, as it decided to invest a greater proportion of the wine it orders into its rapidly-expanding store estate.
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