Virgin Wines has reported a return to profitability in its 2024 financial year, following a strategic focus on cost-cutting.
The wine retailer achieved a pre-tax profit of £1.7 million for the year ending 28 June, recovering from the previous year’s loss of £700,000. This turnaround comes despite steady total sales of £59 million, highlighting the effectiveness of its financial strategies.
A significant part of this success stems from £1.4 million in savings realised over the year. The efficiency drive also reduced the cost per customer acquisition to £19.62, an improvement over the 2023 figure of £19.91, and lowered fulfilment costs to 11.8% of sales compared to 14% previously.
Jay Wright, the chief executive of Virgin Wines, expressed satisfaction with the company’s full-year results, noting increased profitability and strategic initiatives. “We are delighted to reiterate a positive full-year performance, with strong profitability,” he stated. The company has seen improvements in new customer conversion rates and cancellation rates while maintaining competitive acquisition costs.
Among the strategic initiatives launched to bolster growth are the Warehouse Wines offering and the Vineyard Collection, alongside the Five O’clock Somewhere Wine Club. Wright also highlighted a new strategic partnership with Ocado, aimed at providing an exclusive collection of 50 wines to the online supermarket’s customers.
Looking ahead, Virgin Wines anticipates its trading results for the first quarter of 2025 to align with expectations, forecasting a strong outcome.
Virgin Wines’ financial recovery underscores the impact of effective cost management and strategic partnerships in driving profitability.
