Virgin Wines: ‘A decent Christmas was needed and delivered’
Virgin Wines delivered a strong Christmas trading performance and outperformed the wider market, although revenue remained flat year on year.
Revenue increased by 6.7 per cent year-on year during the six weeks to 27 December, 2024, the company told markets this morning.
Sales rose nine per cent in December 2024 versus December 2023, reaching the highest level since the Covid-19 lockdowns, it added.
Virgin Wines said the boost was driven by “initiatives to grow the customer base and optimise customer acquisition”, as well as “strategic marketing and focused promotional activity”.
However, revenue for the full six months was flat, at £34.1m versus £34.3m in the first half of the year.
CEO Jay Wright said: “We are pleased to report an encouraging first-half performance, and particularly strong year-on-year growth of 6.7 per cent over the key six-week Christmas trading period despite the continued sector and macro-economic headwinds.
“We delivered increased levels of new customers, improved our operating cost per case and continued to drive high growth through our commercial channel.
“We continue to increase market share thanks to the loyalty of our customers, our outstanding customer service and the quality of our wines.
“Our strong balance sheet and healthy cash position gives us the opportunity to invest in growth and I look forward to sharing those exciting plans when we come to announce our interim results in March.
“In the meantime, we are confident of delivering a strong second-half performance.”
Panmure Liberum analysts rated the stock a ‘buy’.
“A decent Christmas was needed (and delivered) in order to keep forecasts unchanged,” analysts said.
“We are mindful there are several key headwinds in 2025 – all regulatory and tax related that need to be mitigated… We keep our forecasts unchanged for now.”
Alcohol duty is set to rise on 1 February, which will have an outsized effect on high-abv wine.
Majestic, Laithwaites, The Wine Society and Cambridge Wine Merchants are amongst the wine businesses who together launched a poster campaign against change to the duty last year.
After struggling during the cost-of-living crisis, Virgin Wines returned to the black last summer after sign-ups to its subscription scheme soared and it boosted operational efficiency.
However, its share price has fallen 86.3 per cent in the past five years, and more than 30 per cent in the past six months.