REG - Virgin Wines UK PLC - FY25 Trading Update

Virgin Wines UKAnnouncement

Thu 07:01

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250731:nRSe2620Ta&default-theme=true

RNS Number : 2620T  Virgin Wines UK PLC  31 July 2025

31 July 2025

Virgin Wines UK plc

("Virgin Wines", the "Company" or the "Group")

 

FY25 Trading Update

 

Key growth drivers performing strongly with EBITDA and PBT ahead of
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 2025 (the "Period").

 

All elements of the previously announced growth plan are performing well:

 

1)   Increased customer acquisition

Customer acquisition across the Group was up 28% on the prior year, with just
a 6% increase in acquisition costs.

 

2)   Drive growth in commercial partnerships

Commercial sales are up 24% year-on-year, partially driven by expanding
relationships with both Moonpig and Ocado.

 

3)   Utilise technology to enhance customer engagement

The development of the new mobile app is on course to be launched in early
2026 as previously announced.

 

4)   Investment in Warehouse Wines

Warehouse Wines, the Group's newly launched value proposition, has delivered
£1.8m of revenue in its first full year of trading.

 

The Group's signature WineBank subscription service has performed well once
again, with membership growth of 1.5% and an annual cancellation rate of just
14.7%, a further improvement on the 16.1% achieved last year.

 

 

Financial Performance

 

Revenue remained consistent with the prior year at £59m (FY24: £59m), in
spite of the subdued consumer environment, with both EBITDA(1) of £2.3m
(FY24: £2.8m) and PBT(1) of £1.6m (FY24: £1.9m) ahead of market
expectations(2) by over 4.5% and 23.1% respectively.  As expected, EBITDA(1)
and PBT(1) were marginally lower than last year due to investment in the
Group's growth strategy, which we announced alongside our interim results in
March 2025.

 

Following an unprecedented rise in alcohol duty alongside the introduction of
a new sustainability tax (EPR) and the associated significant increase in cost
of goods, gross product margin decreased from 37.6% to 35.6%. However, these
cost pressures were largely mitigated due to disciplined cost control that led
to a year-on-year reduction in marketing costs of 13% and a decrease in
operating costs of 6%. This was achieved despite the impact of the increased
national living wage and the rise in National Insurance contributions.

 

The business continues to pride itself on being the sector's lowest cost to
serve with operating costs as a percentage of revenue at 11%, down from 11.8%
in FY24, despite the aforementioned significant, unavoidable cost increases.

 

Despite the challenging environment, we are pleased to have made strong market
share gains.  Whilst our revenues have remained stable year-on-year, IMRG(3)
has reported data highlighting a 9.7% fall in online sales of wine, beer and
spirits from July 2024 to June 2025.

 

 

Balance Sheet

 

The Group's balance sheet remains strong, ending the Period with net cash of
£9.3m (FY24: £10.3m), and the business remains highly cash generative. The
current cash position is stated after £2.0m of shares were repurchased during
the year, as well as there being £1.6m of outstanding duty pre-payment
carried into FY26. The business remains debt free, with gross cash including
WineBank customer deposits totaling £17.6m (FY24: £18.4m).

 

(1)EBITDA and PBT are underlying metrics stated prior to share-based payments

(2) Consensus forecasts immediately prior to this announcement believed to be
Underlying EBITDA - £2.2m, Underlying PBT - £1.3m

(3) IMRG Online Retail Market Results June 2025

 

 

 

Jay Wright, Chief Executive Officer at Virgin Wines, commented:

 

"As we celebrate our 25(th) anniversary this year, I am delighted to report
excellent progress across all our key growth drivers.  Both EBITDA and PBT
were ahead of market expectations, and we have seen impressive growth in both
our Commercial channel and our value proposition, Warehouse Wines, two key
elements of the growth strategy which we set out in March.

 

We have continued to drive increased levels of loyalty from customers on our
key WineBank subscription scheme, whilst our marketing and operational costs
have both reduced substantially year-on-year despite the inflationary
environment. In a highly competitive sector, we have been delighted to see
healthy market share gains with customers continuing to rate highly our
exclusive portfolio of wines, and our outstanding levels of service."

 

The information contained within this announcement is deemed by the Company to
constitute inside information pursuant to Article 7 of EU Regulation 596/2014
as it forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 as amended.

 

- Ends -

 

Enquiries:

 

 Virgin Wines UK plc                                             Via Hudson Sandler

 Jay Wright, CEO

 Amanda Cherry, CFO

 Cavendish

 (Nominated Adviser and Sole Broker)

 Matt Goode, Seamus Fricker, Elyssia Bough (Corporate Finance)

 Matt Lewis (Corporate Broking)

 Hudson Sandler

 (Public Relations)

 Dan de Belder

 Harry Griffiths

 Eloise Fleet

                                                                 Tel: +44 20 7220 0500

                                                                 virginwines@hudsonsandler.com (mailto: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 former 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 of
over 145k, the majority of whom are on one of the Group's subscription
schemes.

 

The Company drives the majority of its revenue through its 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.

 

The Company also has a fast-growing Commercial division, as well as having
recently launched Warehouse Wines, its DTC value proposition in 2024.

 

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, as well as being voted by UK consumers as Online
Retailer of the Year for 2025 at the People's Choice Awards. In addition, in
2023 the Group's Buying Director, Sophie Lord, was named Buyer of the Year
by Decanter magazine.

 

https://www.virginwinesplc.co.uk/ (https://www.virginwinesplc.co.uk/)

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTWPUBAMUPAGAU