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NZ Whites Drive Majestic Wine's Christmas Sales

Source: Reuters
03/01/2008

London, Jan. 3 - Britain's Majestic Wine Plc said on Thursday its like-for-like sales rose 4.1 percent in the five weeks leading up to Christmas, thanks to enthusiasm for New Zealand wines and good champagne sales.

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"We saw another very good Christmas for champagne and indeed sparkling wine. Probably the most exciting area of growth through last year and at Christmas was from New Zealand, just a tremendous enthusiasm for New Zealand whites, New Zealand Sauvignon," Chief Executive Tim How told Reuters.

"We have got a lot of really interested consumers who are willing to try new wines, and therefore tastes will change".

Britain's largest wine warehouse chain, which runs 136 stores, said low consumer confidence in October and November linked to global credit turmoil meant consumers put off Christmas shopping until late in the season.

"Overall, consumers are clearly more cautious. Generally, we felt consumers were holding back significantly in both October and November," How said.

Like-for-like sales were up 1.2 percent in the nine weeks from Oct. 30 to Dec. 31, after growth of 4.4 percent in the same period last year, the company said.

Majestic Wine's shares slipped 0.7 percent to trade at 267 pence by 0915 GMT, having fallen 25 percent in 2007.

How said the company's gross margins would be up on the previous year as the average bottle price continued to increase, reaching 5.93 pounds in 2007, compared with 5.73 pounds the previous year.

The company expects a challenging 2008, with low consumer confidence continuing, but How said he believed wine was the growth area of the alcoholic drinks industry.



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