Majestic Wine’s profits have dive-bombed in its first half, swinging to a loss after a promising year.
The wine retailer posted a £200,000 loss in the six months to October 1, following a £3.1 million profit in the prior year.
Looking forward, the alcohol retailer said it expected full year earnings to be flat “at best”, while investment to expand its Naked Wines division is expected to further hit profits.
It also said that it was stockpiling between £5 million and £8 million of extra inventory amid fears of supply chain disruption after Brexit.
“We’re doing well in a tough market,” chief executive Rowan Gormley said.
“We set out a plan at our capital markets day in April 2018 and we are delivering against it.
“That plan was to accelerate growth by investing in new customers and, so far, the plan is on track.”
This follows a promising year for the retailer, which saw revenues rise 2.3 per cent in the year to April 2, while pre-tax profits surged 33.3 per cent.
Gormley said at the time that he expected “the UK market to remain tough, possibly even tougher than last year”.