Virgin Wines ends year in line with expectations

Direct-to-consumer wine retailer Virgin Wines said in an update on Monday that its full-year financial performance was in line with market expectations.

The AIM-traded firm said total revenue for the 12 months ended 30 June reached £59m, meeting projections, while its adjusted pre-tax profit stood at no less than £0.5m.

It described a “robust” balance sheet, with a healthy net cash position of £5.5m, and zero debt.

Throughout the year, Virgin Wines said it had implemented its disciplined strategic approach to customer acquisition.

The company said it added more than 90,000 new customers during the period, improving its recruitment cost efficiency by 9.2% compared to the previous year.

On average, the cost per recruit was £12, lower than the 2022 figure of £13.22.

The firm also described positive trends in conversion and cancellation rates during the fourth quarter, adding that customer deposits into WineBank reached a seasonal high of £8m by the year-end.

“Despite the inflationary environment, we have delivered results in line with expectations,” said chief executive officer Jay Wright.

“We have successfully maintained our disciplined approach to customer acquisition, conversion and cancellation rates are trending positively, and our flagship WineBank scheme continues to be resilient in challenging market conditions.”

Looking ahead, Wright said the company was confident in its underlying business model and opportunities for future growth into the 2024 financial year and beyond.

“We are well-positioned due to the uniquely sourced, high-quality nature of our wines, coupled with our market-leading expertise and strong foundations, and look forward to sharing more details on our strategic initiatives at the full-year results.”

At 0919 BST, shares in Virgin Wines UK were up 3.45% at 30p.

Reporting by Josh White for Sharecast.com.