Naked Wines lifts full-year profit guidance

Naked Wines lifted its full-year profit outlook on Tuesday following "solid" holiday trading.

The online wine retailer now expects FY adjusted earnings before interest and tax of £13m to £17m, up from previous guidance between £9m and £13m.

Naked Wines said revenues in the third quarter were flat on the same period a year ago.

Chief executive Nick Devlin said: "We have executed well against our pivot to profit in our key holiday quarter delivering flat reported revenue versus prior year (-6% constant currency), improving year-on-year repeat customer contribution margins and tightly controlling our SG&A expenses.

"Against a challenging market environment the robust performance of our repeat customers reflects the enduring appeal of Naked's core proposition combined with strong operational performance- with increased throughput from our investment in warehouse automation supporting an especially strong peak in the UK."

The company said the consumer and marketing environment "remains challenging" and opportunities to invest in new customer recruitment at attractive payback levels continue to be limited. It expects to spend between £20m and £24m on new customer investment in FY23, which is around 40% below the previous year’s levels.

"This is below the run rate necessary to maintain our current scale and we are likely to see a modest decline in revenue in FY24 as a result," it said.