Naked Wines has reported a 68% surge in sales over the past year as customers flocked to buy wine online during the coronavirus crisis.
The online wine retailer, whose website crashed at Christmas because of customer demand, also reported a 53% increase in regular customers, with the pandemic accelerating the trend of buying wine online.
“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,” said Nick Devlin, the chief executive of Naked Wines, who expects the business to grow sales by about a fifth annually.
The company’s total sales increased by 68% to £340m in the year to 29 March, driven by the US, where there was 78% revenue growth. The US is Naked Wines’ single biggest market, with sales of £161m, accounting for 48% of total revenues.
The retailer, which operates in the UK, US and Australia, grew its all-important base of repeat customers, which it calls angels, by 53%, to 886,000. However, the company reported a pre-tax loss of £10.7m. This was down to a more than doubling of investment in attracting new customers, to £50m, up from £23.5m in 2019.
Naked Wines said that sales in the first two months of its new financial year, April and May, were up 96%, prompting it to forecast sales of between £355m and £375m this year. Another £40m to £50m will be spent acquiring new customers in 2021.
“Naked now stands at an inflection point with outstanding growth potential ahead,” Devlin said.
Naked Wines was acquired by the retailer Majestic Wine for £70m in 2015. The business was subsequently rebranded as Naked, with the Majestic retail chain sold to the US firm Fortress Investment Group for £95m in 2019.