// Virgin Wines’ profits and sales dropped in the first half as the business was impacted by internal and operational challenges
// But the wine specialist said January and February trading was “broadly in line with expectations” with consistently resilient demand among customers
Virgin Wines posted declining sales and profits in the first half of its financial year after the company was impacted by internal and operational challenges.
In the six months to 31 December 2022, total revenue fell to £33.6m, down from £40.6m a year earlier, while pre-tax profit came to just £0.1m, down from £3.2m, and underlying EBITDA of just £1.4m, down from £3.9m in the same period in 2022.
Giving an update on more current trading, the online wine specialist said sales in January and February were broadly in line with expectations following consistent demand from loyal customers.
As previously announced, the retailer is expecting its full-year revenue to come in at around £63 million.
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The business said it acquired more than 60,000 new customers over the period and said recruitment to its WineBank subscription scheme was up 21% year on year, with deposits of £6.5m.
The company also launched a new partnership with Saga which generated over 2,000 new members in the lead-up to Christmas. In addition, partnerships with Moonpig, Avanti West Coast, LNER, Great Weemstern Railway and Virgin Red were pivotal in driving revenue through its B2B channel.
Chief executive Jay Wright said: “As previously announced in our year-end trading update, profitability was impacted during the first half, with a number of macroeconomic headwinds exacerbating certain internal and operational challenges which we encountered particularly over our peak Christmas trading period.”
“We continue to make progress on addressing the challenges where we can, and we remain confident in the future growth prospects of Virgin Wines.
“The growth in our WineBank membership and continued focus on low cost customer acquisition, disciplined cost control, maximising gross margins and optimising working capital to maximise free cash flow, places us in an advantageous position to capitalise on opportunities as the cost of living crisis eases.”
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