Virgin Wines CEO Jay Wright is bullish about the online wine retailer’s prospects despite the consumer environment showing no signs of improving so far in 2026.
The London-listed group is six months into a five-year plan to build annual revenues of £100m and an EBITDA margin of 7%.
Sales rose 2% to £34.7m in the six months to 2 January as the business made market share gains and outperformed the wider online drinks market, with strong trading over the peak Christmas period (sales up 5% over the seven weeks to 26 December).
Virgin delivered an “unprecedented” 40% year-on-year jump in customer numbers in the half as it invested £900k investment in acquisition and marketing.
However, despite tight control over costs, the spending pushed the company into the red, with pre-tax losses of £400k, compared with a profit of £1.3m in the same period last year.
Analysts at investment bank Cavendish said the results illustrated good progress and added Virgin was keeping its foot on the accelerator with growth of new recruits ramping up by 54% in January and 83% in February.
Sales growth also gathered pace this year, rising by 12% in the first two months of 2026 as recent new customer acquisition began to translate into higher repeat purchasing.
Virgin is continuing to prioritise growth, with a further £550k investment planned for its second half.
Shares in Virgin Wines are down 3.5% this week to 55p. The stock has fallen 12.7% in value so far in 2026, which is unsurprising given the wider economic backdrop for all companies in consumer industries. But the share price remains 16% up over a 12-month period.
CEO Jay Wright highlighted the group’s “incredibly strong” balance sheet, with net cash of £10.6m, and said it remained debt free.
“We’re investing in growth; we’re not investing in making losses,” he told The Grocer this week. “But the way our business works is if you’re going to invest in marketing spend to help drive your business, it’s an opex cost and hits your P&L. If we were building a factory that would be capex and it wouldn’t hit in the same way.
“You can see the trend is moving in the right direction, but it takes a while to get things moving back into growth and new customers start to convert and become profitable. We’re really encouraged by what we’re seeing so far, and we’ll continue to run business incredibly leanly but invest in areas where it’s going to give our customers most value.”
Wayne Brown at Panmure Liberum, which has a ‘buy’ rating on the shares and a target price of 85p, said: “Having faced significant cost increases (regulatory and otherwise) over the last few years, with potential for more to come, sustained sales growth remains critical for Virgin Wines to offset these pressures. The early momentum in the second half therefore represents an encouraging initial sign, and even though they have done a brilliant job on costs, driving profitability remains a difficult challenge.”
Wright said customer acquisition would focus on creating more commercial partnerships, such as with the likes of Ocado and Moonpig, rather than discounting.
“Our main way of bringing customers in is building relationships with other businesses who’ve got a demographic who we think will be a good customer profile for Virgin Wines,” Wright added.
“There’s absolutely no point in trying to bring customers in on deals or promotion where they’re not going to come and become long-term customers of Virgin Wines. One of the things we’ve always been very disciplined in terms of making sure we don’t just throw lots more at each customer we’re trying to bring in. And, similarly, just trying to make sure that we can keep our conversion rate for those new customers high.
“You have to get customer acquisition metrics right, otherwise the business doesn’t work.”
Virgin manged its 40% increase in customers in the first half while maintaining its cost per acquisition broadly in line with the prior year at £15.34.
Wright said the business had not yet seen any impact from the conflict in the Middle East “at this early stage”.
“But the thing we will always be most wary of is anything that negatively affects consumer confidence,” he added. “That is what has the biggest impact on the business as time goes on. We’re not a high energy user. Glass, shipping and employment costs are the three areas where we would be looking at where there might be some cost creep. But it’s a very low amount of our overall cost base, so shouldn’t have a material impact.
“If consumers continue to feel the pinch moving forwards, that’s the area where there might be more of an effect.
“But we’ve always done quite well when recessions come around. What you lose by people not wanted to buy by the case is offset by how expensive it is to go out to eat and drink. Consumers do see the benefits from a cost perspective of staying in and enjoying their social time at home instead.”
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