Full-year sales slipped at wine merchant Majestic Wine (MJW), but that's not as significant as it seems. Not only did 2012's comparative period benefit from an extra week of trading, but the outcome also reflects a planned scaling back of the wholesale arm - where sales fell by £12.7m. Strip out the wholesale result and underlying sales rose 2.6 per cent, while earnings were boosted by cost controls.
Same-store UK retail sales rose 1 per cent and Majestic opened 16 new stores - bringing the total to 193. Customer numbers grew by 56,000, too, and they're trading up - fine wine sales rose 9.4 per cent. Moreover, cutting the minimum online order to six bottles helped online sales rise 14.7 per cent - online generated 11.1 per cent of UK retail sales, with growth in online transactions more than offsetting a 7 per cent dip in average order value. Investment in the commercial business, meanwhile, helped boost sales there by 13.6 per cent and Majestic Calais increased profit by 13.5 per cent to £1.6m. However, weak en-primeur sales meant profit at fine wine merchant Lay and Wheeler fell 8.9 per cent to £1.7m.
Broker Investec Securities expects pre-tax profit of £25.8m in 2014, giving EPS of 29.3p (from £23.7m and 26.6p in 2013).
| MAJESTIC WINE (MJW) | ||||
|---|---|---|---|---|
| ORD PRICE: | 450p | MARKET VALUE: | £293m | |
| TOUCH: | 450-452p | 12-MONTH HIGH: | 490p | LOW: 397p |
| DIVIDEND YIELD: | 3.5% | PE RATIO: | 17 | |
| NET ASSET VALUE: | 135p | NET CASH: | £2.9m | |
| Year to 1 Apr | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 202 | 7.40 | 5.30 | 9.80 |
| 2010 | 233 | 16.0 | 18.4 | 10.3 |
| 2011 | 257 | 20.3 | 23.0 | 13.0 |
| 2012 | 280 | 23.2 | 26.5 | 15.6 |
| 2013 | 274 | 23.7 | 26.9 | 15.8 |
| % change | -2 | +2 | +2 | +1 |
Ex-div: 17 Jul Payment: 16 Aug | ||||
