Majestic hit as business clients cut down on champagne

Published on Monday 10 November 2008 21:39

FALLING champagne orders from business clients dented Majestic Wine's interim profits yesterday as the company prepared for a "challenging" Christmas.

But, undeterred by the downturn, Steve Lewis, Majestic's chief executive, yesterday revealed that the company planned to open a new "fine wine" warehouse next year on Edinburgh's Leith Walk.

The store, which will be the chain's third in the capital and 12th in Scotland, will also have facilities to hold introductory wine tasting courses.

Sales of fine wines – which retail for more than 20 – jumped by 10.7 per cent in the past six months and Majestic will have fine wine displays in 53 of its 148 warehouses this Christmas.

Lewis said he expected the company's line-up of festive season wines – which included special offers on sauvignon blanc from New Zealand and a range of wines from Spain – to sell well in Scotland, in which those lines were already popular.

Sparkling wines would also be on offer, he said, as customers traded down from champagne.

Lewis told The Scotsman: "We have always sold proportionally more sparkling wine in Scotland than in the rest of the UK.

"We needed to up our game in Scotland because we didn't do as well as we wanted to last Christmas so we've got sharp prices on Spanish wine and on New Zealand sauvignon blanc."

He said the new Edinburgh store – on the site of a former Kwik Fit service station – was due to open its doors next year.

Majestic yesterday reported a 25.5 per cent fall in interim pre-tax profits to 5.6 million.

Total sales in the 26 weeks to 29 September rose by 3.4 per cent to 94.1m. But like-for-like sales – which excluded new stores – dropped by 2.1 per cent.

Majestic maintained its interim dividend at 2.8p.