Majestic Wine promised not to pass on the 1 January VAT increase to its customers for a month yesterday, as it toasted a jump in half-year pre-tax profits which was ahead of market expectations.
Steve Lewis, the chief executive of the wine merchant, which has 153 warehouses, said: "We will be holding our Christmas prices until the end of January and we will be swallowing the price increase from VAT [going up].
In a relatively modest turnover period we want to make sure customers have a compelling reason to visit us." His comments came as Majestic said that its pre-tax profits for the 26 weeks to 28 September had risen by 9 per cent to £6.1m, driven by tight cost controls and strong underlying sales growth. Like-for-like sales – stripping out the impact of new space – rose 5.4 per cent in the half-year, while the average bottle of still wine purchased rose 22p to £6.41.
Majestic said its decision in September to reduce the minimum purchase in-store from 12 bottles to six had led to an increase in average transaction volumes.Reuse content