Corker profits rise at Majesic as Brits get a taste for New Zealand

The company said yesterday it had also benefited from the fall into administration late last year of First Quench Retailing, owner of rival chains Threshers and Wine Rack.

Steve Lewis, Majestic's chief executive, unveiling an underlying group pre-tax profit of 16 million in the year to 30 March, said: "Wines from New Zealand, of which 90 per cent is Sauvignon Blanc, are now 18 per cent of our still wine sales, which is quite remarkable."

Shares in Majestic, which have risen by 40 per cent over the past year, rose another 7 per cent, closing up 19.5p at 292p.

The company, which raised its dividend 5 per cent to 10.3p, trades from 153 UK stores, but says it sees scope for another 100 or so. It plans 12 openings in this financial year.

"It has a strong balance sheet and has more than adequate flexibility to take advantage of increased opportunities for new sites appearing on the market," Greg Feehely, analyst at Altium Securities, said.

Sales rose 15.6 per cent to 233.2m, boosted by last September's decision to move from a 12 to a six-bottle minimum purchase.

That decision, designed to boost Majestic's share of a British wine market worth 6 billion, drove a 14.6 per cent rise in transaction numbers to 1.7 million.

However, average spend per customer was down 4 per cent to 129.

Majestic said it had continued to perform well in its new financial year, with sales at UK stores open over a year up 7.3 per cent in the ten weeks to 7 June.

Lewis said it would be a "tough ask" to continue customer growth at the current rate, adding that the trend since Christmas had been consistent.

He said Majestic did not traditionally get a boost to trade from the football World Cup, under way in South Africa, but received greater benefit from warm summers.

"You get a couple of weeks of warm weather and people start stocking up. And if they've got wine at home they're more likely to consume it," Lewis added.