Majestic stockpiling up to £8m of wine ahead of Brexit
Majestic Wine has revealed plans to stockpile up to an extra £8 million of wine ahead of Brexit amid worries over a no-deal hit to deliveries.
The wine retailer said it plans to import additional bottles worth between £5 million and £8 million before the end of its financial year and Brexit day on March 29.
It is the latest UK firm to announce stockpiling plans amid fears a no-deal Brexit could lead to gridlock at ports and disruption to the transport of vital supplies and ingredients.
Compass, the world’s biggest catering firm, said earlier this week it is planning to stockpile if a withdrawal deal looks unlikely to be agreed, while other businesses taking similar measures include Mr Kipling cakes firm Premier Foods.
Details of Majestic’s Brexit contingency plans came as its half-year results showed it plunging to a loss, and it warned about the impact of “tough” retail conditions.
Shares tumbled 12% as the group said it swung to a pre-tax loss of £200,000 for the six months to October 1 from profits of £3.1 million a year earlier, after previously-flagged efforts to attract more customers.
It cautioned it now expects underlying earnings across its retail and commercial divisions to be flat “at best” in 2018-19 amid a difficult market.
The group’s push to expand Naked Wines will also hit the division’s profits, with investment set to be more than expected at £20 million or higher over the full-year.
But the firm said it is on track to meet its target of £500 million of sales over the financial year.
Rowan Gormley, group chief executive, said: “We’re doing well in a tough market.
“We set out a plan at our capital markets day in April 2018 and we are delivering against it.
“That plan was to accelerate growth by investing in new customers and, so far, the plan is on track.”