Naked Wines returns to profit as it stockpiles booze ahead of Christmas

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Naked Wines has bounced back into the black and increased its stock levels as the pureplay prepares for its “largest holiday season” to date.

wine bottles

The online booze specialist posted a pre-tax profit of £1.3m in the 26 weeks to September 27, compared with a loss of £8.9m during the same period last year.

Naked also returned to profit on an adjusted EBIT basis, registering earnings of £1.2m compared with a £3.2m loss in the first half of last year.

The retailer’s revenues rose 6% year on year to £159.3m on a constant currency basis.

It attributed the gains to strong sales among repeat customers, although it admitted sales to new customers declined due to a “tough comparison” last year when lockdown restrictions drove more shoppers to buy booze online.

Naked reduced its full-year sales guidance to £340m to £355m, compared with the previous range of £355m to £375m.

The overall number of customers signing up for Naked’s subscription services jumped 25% to 947,000 compared with the same period last year.

Naked said it was holding stock worth £127m – a 50% uplift on the £85m of booze it had in its warehouses in September 2020. The retailer said it was “mindful of the challenges in restoring availability over the past 12 months and continued supply chain disruption”.

It said it planned to maintain higher stock levels “over the medium term” in order to “preserve availability for customers and ensure we do not constrain our growth potential”.

Naked insisted that, as a result, it was “well-positioned” for the crucial Christmas trading period.

Naked chief executive Nick Devlin said: “I’m delighted by the progress we have made so far this year in further strengthening our winemaker line-up and customer proposition. We are now serving a global community of 947,000 members – an increase of 25% over the last year – reflecting sustained consumer desire for an alternative to traditional wine distribution.

“I’d like to thank all our teams for their hard work in a challenging supply environment for ensuring we are well stocked and prepared for what we anticipate to be a record holiday season.”