Virgin Wines has issued a warning on full-year profits after a harsh half-year trading period hampered by strikes and operational problems.

Virgin Wines advent calendar

Operational issues created a backlog of orders in the run-up to Christmas

The retailer now expects revenue for the full year to be £63m and EBITDA margin to be between 4% and 5%, with underlying EBITDA margin expected to be 6-7%.

Total revenue for the period was £33.7m as the retailer said sales were “impacted by some one-off factors”.

The company is estimated to have lost £1.5m in revenue as delivery cut-off dates were brought forward due to postal strikes and bad weather.

The retailer lost a further £1.7m in sales in September as all marketing activities were suspended after the death of Queen Elizabeth II.

Virgin Wines’ new warehouse management system also faced operational issues, which created a backlog of orders in the run-up to Christmas. 

The retailer reported a 24% like-for-like increase in new customer acquisition, adding 60,000 in the period.

Its WineBank subscription scheme acquired new customers as 42,000 joined, a 21% increase compared with the same period last year. Total membership of the scheme is now 142,000.

Chief executive Jay Wright said: “We are disappointed with our profitability performance over what has been a difficult trading period, which has been exacerbated by one-off exceptional circumstances. However, our underlying business model remains resilient as the consumer proposition continues to resonate strongly. 

“We are pleased to have attracted a significantly increased number of new customers to our WineBank scheme, our strategic partnership with Saga has started promisingly and our other commercial partnerships continue to perform well.

“Whilst being mindful of the pressures on the business, especially with regards to the high inflationary landscape, we remain confident in our future prospects, driven by the ongoing strength of the brand, our unique offering and loyal customer base.’’