Virgin Wines UK revenues fall as Covid-19 restrictions ease

Online wine retailer Virgin Wines UK said revenues and underlying earnings had contracted year-on-year after the lifting of Covid-19 restrictions across Britain.

Virgin Wines UK said full-year revenues were now expected to come in at around £69.0m, down from £73.6m in the twelve months ended 30 June 2021, while underlying earnings were expected to slip from £7.0m to £6.3m.

However, the AIM-listed firm did state that revenue was up 63% on a three-year basis, highlighting that the business had retained much of the "substantial growth" achieved during Covid-19 lockdowns, despite the lifting of restrictions and opening up of hospitality.

Virgin Wines also highlighted that it had an "industry-leading" EBITDA margin of 9.1% and gross margins of 31.5%.

Chief executive Jay Wright said: "Our growth, driven by a substantial pipeline of new partnerships to drive increased customer acquisition, will continue in a post-Covid world, and we continue to drive levels of profitability unseen elsewhere in our market sector whilst maintaining our gross margins despite the widely documented global cost pressures.

"Our disciplined approach to customer acquisition continues to generate strong returns on investment and our wider strategy and business model continue to position us well to mitigate rising costs and to help us deliver against our growth plans."

As of 1110 BST, Virgin Wines shares were down 7.59% at 67.0p.

Reporting by Iain Gilbert at Sharecast.com