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Virgin Wines has downgraded its profit forecast for the year ending 3 July 2026, as it revealed macroeconomic pressures have hit consumer discretionary spending.
As a result, the group now expects to post a profit before tax loss of £1.5m and EBITDA loss of £200k.
According to the retailer, rising costs from increased alcohol duty and extended producer responsibility packaging levies also impacted performance.
Management also expects total revenues for the year to reach approximately £61m. While sales fell 4.5% in the first quarter, the business experienced a recovery in trading with sales rising 5% in the second quarter and 8% in the third quarter.
To lower structural costs, the online retailer signed a lease for a new warehouse facility in Preston to consolidate its fulfilment operations. The company will exit its existing Bolton site by February 2027 to eliminate transport costs between the two locations.
The warehouse consolidation will require £1.6m in capital expenditure and incur £700k in exceptional operating costs. The investment will be funded through existing cash reserves, leaving the company debt-free.
Despite economic pressures, Virgin Wines noted that its customer acquisition increased 40% year-on-year, supported by commercial partnerships with Moonpig and Ocado. The company also launched a mobile application which secured 13,000 downloads during April and May.
Jay Wright, chief executive of Virgin Wines, said: “Our execution against the key pillars of our growth strategy is delivering encouraging progress, despite that growth now being slightly slower than our original plan due to external market pressures.
“We are evidencing that the strategy is working, and we remain focused on taking further market share and continuing to invest in our growth channels.”
