Online wine seller Naked Wines has reported a slump in profit and a higher loss despite “significant strides” made over the past few months to restructure the business.
Total sales fell by 18 per cent year on year to £290m in the 52 weeks ended 1 April 2024, while the company’s statutory loss before tax widened to £16.3m from £15m in 2023.
Losses rose as the company invested more in customer acquisition, but repeat business from existing customers fell. Investment in new customers rose nine per cent , while its repeat customer contribution fell by a quarter.
Adjusted earnings before interest and tax fell by 71 per cent to £5m from £17.4m in 2023.
Chief executive Rodrigo Maza said Nake Wines had made “significant strides” in the past few months by “strengthening financial foundations, embedding resilient management practices, and crystallising a robust customer proposition”.
“This proposition not only drives our mission to enable independently-minded wine drinkers to enjoy great wine without the guesswork but ultimately ensures long-term engagement and a competitive advantage,” he said.
Rowan Gormley, non-executive chairman, said: “I am pleased to report that [the] company is in much better shape than it was a year ago and that we have made substantial progress in returning Naked to profitable growth.
“This is not immediately apparent from the trading results which, although in line with expectations, reflect the company we were, rather than the company we are starting to become.”
Naked Wines: ‘Turning things around’
Naked Wines struggled to burn through excess stock and suffered from sustained high inflation in key markets last year, which impacted their supply chain costs.
Revenue at the online wine retailer slumped 13 per cent in 2022, and it cut 50 jobs—including two board members—to shore up costs.
This followed a series of profit warnings and a £15m reported loss.
Gormley said: “We’re making real progress turning things around. Now that the team has addressed the cost base and liquidity issues, we can focus our attention on the big prize…restoring Naked Wines to profitable growth.
With a new invigorated team looking at the challenge with a fresh perspective, I feel confident that we will see Naked fulfil its potential to revolutionise the direct-to-consumer wine market.”
Separately, Naked Wines announced the appointment of Dominic Neary as chief financial officer. The company said the new CFO would join the company on 11 November 2024 and would also be appointed to the board.
Naked Wines said the new CFO would join from Mind Gym where he: “Helped return the business to profitability, whilst building scalable global operations…. he brings with him significant experience from senior finance roles at international high growth consumer, digital and FMCG companies.”
The retailer announced the departure of its chief financial officer earlier this year, along with news that it had secured a $60m (£47m) credit line with PNC bank.