25 July 2024
Virgin Wines UK
plc
("Virgin Wines", the
"Company" or the "Group")
FY24 Trading
Update
Revenue resilient, with
EBITDA and PBT ahead of market expectations
Virgin Wines UK plc (AIM: VINO), one
of the UK's largest direct-to-consumer online wine
retailers, is pleased to announce a trading
update for the year ended 30 June 2024 (the "Period").
Revenue was in line with the prior
year at £59m (FY23: £59m), while enhanced margins and operational
efficiencies, particularly in warehouse fulfilment, drove an
improvement in profitability.
EBITDA1 increased by 260%
to £2.8m (FY23: £780k), with Profit/(Loss)1 before tax
expected to be £1.95m (FY23: Loss £430k).
The balance sheet remains strong
with net cash at the end of the Period significantly higher at
£10.2m (FY23: £5.5m), driven by a strong bottom-line performance
and improved inventory management. Gross cash including WineBank
customer deposits totaled £18.3m (FY23: £13.5m) and the business
remains debt free.
Despite an inflationary environment
and ongoing cost pressures the Group increased its gross margins to
31.9% (FY23: 29.6%), driven by the Company's unique sourcing model
and strong cost control.
New customer conversion rates on to
the Group's subscription schemes increased materially to 55.5%
(FY23: 49.2%) and, in a similarly positive vein, cancellation rates
on the Company's flagship WineBank membership service improved to
16.1% (FY23: 17.3%).
Although customer acquisition has
continued to be challenging, the rate of acquisition increased
throughout Q4 whilst the Group maintained its disciplined approach,
decreasing the fully costed cost per acquisition to £19.62 (FY23:
£19.91).
The Company's new value proposition,
Warehouse Wines, that launched pre-Christmas 2023, has started
encouragingly with a particularly strong Q4, and an improving rate
of customer acquisition. The business intends to make increased
levels of investment in this key new initiative over FY25 and
beyond.
Share Buyback Programme Update
Further to the Company's
announcement on 30 May 2024 detailing a repurchase of shares and
the launch of a share buyback programme (the "Programme"), a total
of 310,735 ordinary shares in the Company have been repurchased.
These shares are now held in treasury in anticipation of the future
exercise of share options under the Company's long term incentive
plan and the Company has now paused the Programme, with the timing
of future potential repurchases remaining under active
consideration.
1 EBITDA and Reported
Profit/(Loss) before tax are stated before share based payments.
FY24 figures remain subject to audit. FY23 comparatives are post
FY23 exceptional costs.
Jay
Wright, Chief Executive Officer at Virgin Wines,
commented:
"I
am pleased to report a full-year performance with resilient sales
despite a challenging consumer and inflationary market backdrop.
Both EBITDA and PBT were ahead of expectations, being significantly
up year-on-year due to expanded gross margins and reduced operating
variables.
Demand remains strong for our range of wines and subscription
schemes. Our flagship WineBank service was recently recognised as
'Wine Club of the Year' at the prestigious International Wine
Challenge awards, and over the past 12 months we have seen it
deliver increased new customer conversion rates and decreased
cancellation rates. Our B2B sales continue to grow while our newly
launched value proposition, Warehouse Wines, has also delivered
encouraging initial results.
We
enter FY25 with the business performing well, and we remain
confident for the future due to the strength of the underlying
business model, our disciplined cost control and unique sourcing
model."
- Ends
-
Enquiries:
|
Virgin Wines UK plc
Jay Wright, CEO
Graeme Weir, CFO
Panmure Liberum Limited
(Nominated Adviser and Sole
Broker)
Edward Thomas
Dru Danford
John
Fishley
Hudson Sandler
(Public
Relations)
Alex Brennan
Dan de Belder
Harry Griffiths
Eloise Fleet
|
Via Hudson Sandler
|
|
Tel: +44 20 3100 2222
virginwines@hudsonsandler.com
Tel: +44 20 7796 4133
|
Notes to editors:
About Virgin Wines
Virgin Wines is one of the UK's
largest direct-to-consumer online wine retailers. It is an
award-winning business which has a reputation for supplying and
curating high quality products, excellent levels of customer
service and innovative ways of retailing.
The Company was established in 2000
by the Virgin Group and was subsequently acquired by Direct Wines
in 2005 before being bought out by the Virgin Wines management
team, led by CEO Jay Wright and CFO Graeme Weir, in 2013. It listed
on the London Stock Exchange's Alternative Investment Market (AIM)
in 2021.
Virgin Wines is headquartered in Norwich, with two fully bonded, national
distribution centres in Preston and Bolton. It stocks over 650
wines sourced from more than 40 trusted winemaking partners and
suppliers around the world which it sells to a large active
customer base, the majority of whom are on one of the Group's
subscription schemes.
The Company drives the majority of
its revenue though its fast-growing WineBank subscription scheme,
using a variety of marketing channels, as well as through its Wine
Advisor team, Wine Plan channel and Pay As You Go
service.
Along with its extensive range of
award-winning products, Virgin Wines was delighted that its
flagship WineBank service was awarded 'Wine Club of the Year' at
the 2024 IWC Awards, was named Online Drinks Retailer of the Year
for 2022 at the Drinks Retailing Awards, as well as receiving the
bronze award for Contact Centre of the Year at the 2022 UK National
Contact Centre Awards. In addition, in 2023 the Group's Head of
Buying, Sophie Lord, was named Buyer of the Year by Decanter
magazine.
https://www.virginwinesplc.co.uk/