Majestic chief executive Steve Lewis said yesterday that the group’s push into craft beers and spirits was helping to fend off competition from supermarkets after sales of brands, including top seller Curious Brew, soared in the first half.
The wine specialist is stacking its shelves with a new range of 40 artisanal spirits such as Sipsmith gin in the run up to Christmas after seeing sales across the category rise 164 per cent in six months to 27 September. “We are improving our range and moving into small specialist areas that supermarkets would struggle with. [Sipsmith] has been a very successful one,” Lewis told City A.M.
Majestic’s profits fell 10 per cent to £8.5m in the six months to 29 September compared with £9.5m last year, which it attributed to “essential investments” such as moving its distribution centre and improving its customer database.
“These are one-off costs that are essential investments in our future growth and won’t occur in the second half,” chief executive Steve Lewis said.
But while profits disappointed, the firm toasted a strong sales performance, with revenue across its 210 stores up 2.8 per cent to £134m and like-for-like sales up by the same amount.
Argentinian Malbec was among its best performing wines, with sales up 41 per cent, while Picpoul, a white wine from the Languedoc, also proved popular, with sales up 27 per cent. Online sales grew by 12.3 per cent, while improvements to its website has helped to produce a 60 per cent jump in click- and-collect orders.
Lewis said more consumers were splashing out on fine wines – costing over £20 a bottle – with sales up 22 per cent: “This isn’t about people buying ultra expensive wine. This is about people spending the same amount they would in a restaurant and getting a much higher quality wine instead.”
Majestic plans to cash in on demand for expensive tipple over the Christmas period by launching a pop-up cellar, sourced by its fine wine business Lay & Wheeler, at 40 of its top turnover stores.