Majestic Wine shook off the effects of the wet summer to post a 3.9% increase in pre-tax profits to £9.2m for the six months ending 1 October.
But total sales at the wine retailer fell 1.4% to £126m, impacted by the poor weather and a planned scaling back of the company’s wholesale activities.
Wholesale revenues plummeted by £7.2m to £3.2m, with chairman David Wrigley explaining, ‘We decided to reduce our involvement in the wholesale drinks market and focus towards on-trade customers.’
He added, ‘During the summer, sales were adversely affected by unseasonable weather that resulted in the cancellation of a large number of outdoor events.’
Majestic also closed its store in Cherbourg during the summer, but increased profits at its two remaining French outlets, in Calais and Coquelles.
Like-for-like UK sales rose 0.6% in the period, while there was an 11.4% increase in active customers to nearly 600,000, plus a 14% surge in online sales.
That was driven by the reduction of the minimum online purchase to six bottles in June – a step taken in Majestic’s stores in September 2009 – and the launch of a mobile website.
Fine wine division Lay & Wheeler also increased profits – up from £0.3m to £0.5m – boosted by sales of the 2009 Bordeaux vintage, but Majestic said demand for 2011 Bordeaux had so far been ‘low’.
Meanwhile, like-for-like UK retail sales for the six weeks following 1 October were up 1.2%, the company said.
‘These results, achieved in a challenging economic environment and the wettest summer on record, display the resilience of the Majestic business,’ said chief executive Steve Lewis.
Majestic, which now has 189 stores across the UK, said it ‘continued to see the potential’ of expanding its UK store roster to 330 in the longer term.
Written by Richard Woodard