Naked Wines shows promise despite a 15% drop in sales, thanks to strategic financial management.
- The company reports a reduced pre-tax loss of £5.6m, down from £9.7m the previous year.
- Inventory liquidation impacts adjusted EBIT, leading to a loss of £3.1m.
- Active membership declines by 12%, affecting sales revenue.
- CEO Rodrigo Maza remains optimistic about future performance, citing robust financial foundations.
Naked Wines is navigating challenging market conditions with a strategic focus that has helped narrow its financial losses. The online wine retailer reported a pre-tax loss of £5.6 million for the six months ending 30 September, a decrease from the £9.7 million loss in the same period last year. This improvement is attributed to the company’s ongoing turnaround efforts which have fortified its financial and strategic standing.
Despite the positive financial strides, the company faced a notable 15% drop in sales, reducing revenue to £112.3 million for the half-year. This decline in sales was largely driven by a 12% decrease in active members, indicating challenges in customer retention and acquisition.
The company’s adjusted earnings before interest and taxes (EBIT) have been adversely affected, with a recorded loss of £3.1 million. This is a result of a £3.7 million hit from inventory liquidation and associated costs, including a £2.5 million increase in the US stock provision and £1.2 million related to the disposal and other wine liquidation expenses.
Looking forward, the company anticipates stable trading conditions during the peak season, expecting an adjusted EBIT, excluding inventory liquidation impacts, to fall between £3 million and £8 million. The full-year sales projections are set to range between £240 million and £270 million.
Rodrigo Maza, the CEO, remains confident in the company’s direction and progress. He states, “Naked Wines is in a better position, both financially and strategically. We now have robust financial foundations, and our members remain loyal and engaged. Our strategic initiatives centered around customer acquisition and retention are generating learnings, and we are currently experiencing solid trading during the peak season period.”
Naked Wines continues to strengthen its position despite market challenges, reflecting a cautiously optimistic outlook.
