Naked Wines saw its share price rise sharply on Thursday after it lifted profit expectations for the year.
The wine club, which connects buyers with independent producers, was a pandemic winner and saw its shares soar during the Covid-19 lockdowns but then plummet afterwards.
Naked Wines shares jumped 8 per cent to 72p today but at their peak in 2021 were trading at more than ten times that price.
The London-listed business told shareholders its annual adjusted earnings before nasties looked set to come in ‘towards the top end’ of published guidance.
That comes despite an expected fall in revenues, as the wine seller continues with a strategy of creating’a smaller but materially more profitable business’.
On the up: Naked Wines saw its share price rise sharply on Thursday
Naked Wines said its bottom line looked strong amid the ‘current success of peak trading’ across all markets, acquisition investments and a ‘disciplined’ approach to costs.
The business previously guided to its chosen profits measure, adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of between £5.5million and £7.5million and revenue of £200million to £216million.
Naked Wines now says profits will be near the top end of that range. But the wine club added that its annual revenue looked set to come in ‘at the lower end of guidance’ to reflect an ongoing strategy shake-up that sees Naked Wines ‘removing inefficient investment’ .
Shares in Naked Wines rose 8.43 per cent or 5.6p to 72p, having risen over 50 per cent in the last year. They remain 92 per cent below their April 2021 peak, however.
Naked Wines shares rocketed during the pandemic and then crashed to earth
Naked Wines said: ‘This builds towards the previously communicated strategy of a smaller but materially more profitable business; poised for a return to profitable growth, with Adjusted EBITDA growing progressively over the medium term.’
The company said it would publish a fuller trading update in mid January.
Earlier this month Naked Wines said it delivered adjusted EBITDA excluding inventory liquidation and associated costs of £3.6million, up 112 per cent from £1.7million in HY25.
Gross profit margin rose to 19.5 per cent from 16.9 per cent. Naked Wines said earlier this month that roughly half of the improvement was due to price increases and cost savings, including reduced acquisition cost, with the balance largely reflecting FY25 inventory movements.
Naked Wines said it sold more than 70,000 special ‘Big Christmas Cases’ between 1 November and start of December.
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