Friday 11 June 2021 7:24 am

Cheers! Naked Wines sales surge 68 per cent on strong US performance

Naked Wines has been one of the few winners during the pandemic, reporting a surge in both customers and sales off the back of a strong performance in the US. 

With pubs and bars shut for most of the year, the online wine retailer reported a 68 per cent increase in annual sales to £340.2m. It also boasted a 53 per cent rise in customer numbers in the year to March. 

It comes after some £50m investment in new customers compared to £23.5m last year, which it said delivered a five-year forecast payback of 3.0x. 

But this 113 per cent increase in investment saw Naked Wines post a pre-tax annual loss of £10.7m.

Naked Wines said it will continue to increase its focus on its US segment, which saw a 78 per cent surge in sales, as it looks to spend cash on new customers, inventory purchases and “strategic priorities”. 

The company is now the largest direct to consumer wine merchant in the US and has managed to scale its operations in response to growing demand. 

“It is clear to us that the pandemic has served to underscore the value of our business model in connecting winemakers and consumers directly and proven the opportunity before us,” group chief executive Nick Devlin said. 

The retailer is now targeting sales of between £355m and £375m, while investing between £40m and £50m in new customers. 

“As we head into FY22, we are focussed on investing in the opportunity and executing against our strategic initiatives, which are i) to invest in New Customers at attractive payback, ii) to enhance the customer proposition to improve LTV, iii) to leverage our scale to enhance value creation, and iv) to broaden and enhance our go-to-market strategy, driving growth,” Devlin added. 

Naked Wines was acquired by physical retailer Majestic Wine for £70m in 2015, but was split off from the business last year. Majestic in turn was sold to US firm Fortress Investment for £95m in December.