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Majestic wine sales fizz over Christmas

Published:  09 January, 2019

Majestic Wine enjoyed a merry Christmas despite the “challenging market backdrop”.

Underlying group sales rose 6.3% for the 10 weeks ending 31 December, up from 4.1% for the same period last year.

The performance was driven by Majestic’s online operation, Naked Wines, which it acquired in April 2015 for £70 million. Sales at Naked jumped 15.9% overall, with 12.2% growth in the UK and higher rises from its US and Australian operations.

It follows increasing investment by Majestic into Naked in the UK, the US and Australia, which is aimed at targeting “new customer acquisition”. More investment is planned to follow.

“Naked Wines has truly gone global,” said Majestic. “2018 saw its strongest ever international festive period, with overall sales up 15.9% including 21% in its US division and 14.8% in Australia. Historically the UK has always been happy to be lead when it comes to wine, now however it seems East Anglia is ready to have its say.”

On the high street, Majestic Retail sales nudged up 1.5%, which it described as a “solid performance”.

“The team have worked really hard over the Christmas trading period and have delivered sales growth across all our business units,” said Group CEO Rowan Gormley.

“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.

“While trading has been challenging over the Christmas period, the trends we reported in November are the same, namely strong growth in our overseas markets and our digital propositions but headwinds for our UK Retail stores. We look forward to setting out more of our future plans for the group, including the Retail business with our full year results in June.”

Majestic makes around 30% of its annual sales over the Christmas period. It said this year reflected a more experimental approach by consumers, with wine buyers snapping up something from ‘off the beaten track’ regions more than ever before.

It said “wines from Eastern Europe, Greece and even England, amongst others, hit the spot as wine-lovers branched out for more adventurous tipples that graced their Christmas tables. England was one of the biggest winners, up 65%, whilst a renewed interest in German and Austrian wines helped to rocket volumes by 99%. Whilst in the Fortified Wine category, Madeira had an unexpectedly bumper Christmas with sales up 20%.”

Majestic also said it was a “similar story at Naked Wines, where wines from Hungary, Bulgaria, Greece and Lebanon were up 58%.”