Naked Wines calls in debt advisors

Online retailer Naked Wines has appointed a debt advisory company to explore refinancing options, which could include securing a new “similar-sized facility”.

Naked Wines has hired debt advisory firm Interpath Advisory to assess a possible restructuring of the wine company following the value of Naked shares plummeting by nearly a third over the last 12 months.

A spokesperson for the company has said that Naked is “considering the options for replacing our existing credit facility.”

The same spokesperson told Sky News: “Having sought expert advice on the current debt market and considering the strength of the balance sheet we believe there may be an opportunity to secure a similar-sized facility that has less limitation on utilisation and more flexible restrictions on the actions we can take to reduce inventory and drive our broader change agenda.”

A sea change of senior personnel switch-ups and declining financial results has shaken investors’ confidence in the online wine retailer.

In November and December, Naked board members purchased a significant number of shares in the wine company, including executive chairman Rowen Gormley forking out £38,630.68 on shares just two days after Naked confirmed that CEO Nick Devlin was leaving his role due to a colossal drop in revenue.

Last month it was announced that Rodrigo Maza would take on the role of group executive officer, having been the company’s UK managing director for less than six months (since September 2023).

Naked revealed that Maza will initially work alongside Gormley to steer the ship back to calmer waters, with Naked having weathered consistently freefalling sales.

The e-retailer’s latest financial results showed a 10% decline in year-on-year sales, a slight improvement on the 18% sales drop it experienced in the first half of the last financial year.

In September 2023 Naked reported a £15 million loss as its sales to new customers dropped to £26.9m in 2023, down from £34m in 2022.

Gormley apologised to shareholders, saying: “The whole board of Naked Wines regret that your support and patience as shareholders, winemakers, angels and employees has not been rewarded. We are all determined to remedy that.”

The big three

Figures from data specialist Statista show that in 2022 Naked Wines was the UK’s biggest online wine retailer, followed by Majestic and Waitrose Cellar to make up the top three.

The 2023 rankings are not yet available, but db can report that during the last year Majestic has gone from strength to strength, having experienced a surge in B2B sales through its on-trade arm, Majestic Commercial, which now services more than 3,000 pubs, bars, restaurants and venues.

Majestic also reported its biggest Christmas earnings in the retailer’s 43-year history, with sales up 8.1% in the eight weeks leading up to Xmas 2023.

However, Majestic is not focused exclusively on e-commerce, and invested in opening six new bricks-and-mortar stores in 2023, with more to come in 2024.

“We have a strong balance sheet and will continue to invest in growth, with more exciting new stores planned this year,” Majestic CEO John Colley said.

Waitrose, on the other hand, introduced 197 new lines to its wine range in 2022, and in its Food & Drink Report 2023/2024 revealed that sales of orange wines had shot up by 85%, with online searches for ‘orange wine’ on waitrose.com up 20%.

The retailer also gave greater shelf space both in store and online to no and low-alcohol wines, beers and spirits, which saw a 23% spike at Waitrose last year.

 

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