Majestic toasts faster sales growth despite challenging Christmas

Majestic Wine has said the Christmas trading period was more challenging than expected, but reiterated its confidence of being a winner in the retail revolution.

Total sales were 6.3% higher in the 10 weeks to December 31, accelerating from the 3.2% growth rate seen this time last year.

The rapid growth was driven by a 15.9% increase in its Naked Wines business.

Retail sales were up 1.5%, but gross margins were 1.2% lower in a “very price promotional market”.

Chief executive Rowan Gormley said changes in consumer behaviour were driving a retail revolution.

“We think there will be winners and losers, and we believe we have what it takes to be one of the winners. We are uniquely placed, with the people, data and skills in place to succeed, despite the headwinds we are seeing,” he said.

The crucial Christmas season, in which the group usually delivers around 30% of its annual sales, proved more challenging than expected due to economic uncertainty and weak consumer confidence.

However, Majestic said it still expects to report annual profits in line with market expectations.

Shares in the company inched 1.2% higher in early trading.

The retailer revealed in November that it was responding to the uncertainty around Brexit by stockpiling £8 million worth of wine.