Majestic Wine sees sales rise but profits fall during first half

The wine specialist reported that group sales in the first half were up 2.8% to £133.8m, compared to £130.2m in 2013, for the 26 weeks to September 29.

UK like-for-likes grew 2.8%, and the business said market share had increased by 0.1% to 4.3%.

Group profit before tax declined to £8.5m, down from £9.5m in 2013.

Profit before tax at the Majestic Wine chain fell to £7.7m, down from £8.4m in 2013. The retailer said this was “due to previously announced investments in infrastructure, technology and consumer insights to support future growth.”

Online sales increased 12.3% to £12.9m, now representing 10.8% of UK retail sales compared to 10.3% in 2013.

Sales to business customers were up 4.9% to £26.8m, and sales of fine wine, priced at £20 per bottle and above, increased by 22.0% to £9.0m. The retailer also reported that four new stores opened during the half.

The retailer also relocated its distribution centre in July 2014 to a larger and more modern facility, and it has completed an in-depth analysis of the market and its customer data to introduce better-targeted communications.

Chief executive Steve Lewis said: “Majestic has a compelling proposition with a differentiated model, strong customer service ethos and a clear strategy to deliver growth. The 2015 financial year is one of investing to put in place the building blocks to deliver future growth and shareholder value and we are progressing to plan.”