// Virgin Wines posts a rise in its full-year profit despite challenging trading conditions
// Profit before tax surged to £5.1m in the year to July 2022
Virgin Wines has predicted that shoppers will host more social gatherings at home rather than heading to the pub as the cost of living crisis bites.
In annual results, the online wine retailer said it was “mindful” of the potential impact of tightened budgets but said it expected people would be “more likely to stay in and socialise at home rather than taking the more expensive option of going out.”
Profits at the business before tax surged to £5.1m in the year to July 2022, from £1.7m a year earlier as it garnered 105k new customers in the 2022 year, 5% above expectations.
While group revenue fell year-on-year from £73.6 million to £69.2 million, it was 63% above pre-pandemic levels three years ago.
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Virgin Wines chief executive Jay Wright said: “Despite widely documented macroeconomic challenges and consumer uncertainty, Virgin Wines has continued to show its resilience and strong positioning in the direct-to-consumer online wine retail sector.
“Our business model and disciplined approach to new customer acquisitions has enabled us to retain much of the substantial growth achieved during the Covid-19 lockdowns, with almost one million cases sold in FY22, and we remain market-leading both in terms of our customer proposition and our profitability.”
Giving an update on more recent trading, Virgin Wines said a positive August gave way to a softer September due to the national period of mourning following the death of Her Majesty the Queen.
Wright said: “We remain confident in the fundamentals of our business, with our emphasis on commercial opportunities through new and expanded strategic partnerships already delivering significant benefits. Our focus on high-quality, exclusive wines and award-winning service to our loyal customers will continue to be our key priority.”
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