Majestic enjoys sales growth

25 June, 2010

Last year’s decision to reduce minimum purchases from 12 to six bottles brought 54,000 new customers to Majestic.

The company said the increase had taken it to 472,000 paying customers in the year to March 29, 2010.

Average spend was down 4% at £129 but transaction numbers increased 15% to 1.7 million.

Majestic said profit before tax was up 117% at £16 million, though the under-lying adjusted figure showed an increase of 26%.

Total sales were up 16% to £233 million, with like-for-likes – excluding six new openings and the acquisition of Lay & Wheeler – up 8%.

New Zealand, South Africa, Chile and Argentina recorded strong growth.

Chief executive Steve Lewis said: “We are very encouraged by our ability to attract new customers which will allow us to continue to grow our market share.

“While the UK economic outlook remains uncertain, we believe Majestic is well positioned for future growth.”?The average price per bottle bought in stores is now £6.56 against £6.35 a year ago.

Sales of fine wine – defined as £20-plus per bottle – increased by 23% and represent some 5% of UK store sales. Fine wine fixtures are now in half of Majestic’s stores with a roll-out to the remainder planned for the next two years.

Online sales were ahead by 20% and are 10% of total UK sales. In the 10 weeks since the financial year end, like-for-like sales were ahead by 7%.

Majestic has now run 10,000 free wine courses for customers after launching the scheme last year.

It is planning to launch a programme of seasonal in-store tastings later in the year.

The chain opened six new stores during the year and has added another at Redhill, Surrey, since the year end to total 153 branches.

It said the retail property picture left by the recession had produced an encouraging “increase in the level of opportunities for new sites appearing on the market”.

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