Naked Wines founder Rowan Gormley today said he planned to retire after completing his project to transform Majestic Wines from a multichannel into a pureplay subscription business under the Naked Wines name.
The sale of the Majestic Retail and Lay & Wheeler parts of the business, first announced earlier this year, is set to complete by the end of the year along with a property disposal. Together the deals will bring in £111m but mark the end of an era for the business. The Majestic Retail sale will leave just the Naked Wines business that founder Rowan Gormley brought to Majestic Wine when he joined joined Majestic Wine as chief executive in 2015 with a brief to turn the loss-making business around.
Ahead of that transition completing, Gormley says he will retire, handing over to chief operating officer Nick Devlin. Devlin currently leads the Naked Wines US business. The retailer will also have a new chairman in the form of John Walden, who previously led Argos.
Gormley says he is leaving the business as a simple one with a clear focus and the tools to do the job. He said: “We have built a solid foundation for growth. Naked Wines is now a pureplay online retailer, with a huge opportunity in the US wine market, and the resources to capitalise on that opportunity.
“Trading has been broadly on track in the first half. Naked’s US business is well up on the key measures of investment, payback and sales. Consistent with our disciplined approach to investment we will slow the rate of increase of investment in new customers in the second half, due to sluggish performance in the UK and Australian markets.
“I will be retiring shortly and will be handing over the CEO role to Nick Devlin, our COO and the man who has built our US business. The company is in excellent hands.
“I want to thank our customers, people, winemakers and shareholders for their fantastic support over the last 10 years. I look forward to remaining a material shareholder - and a material customer!”
The update came as the retailer, now named Naked Wines, published half-year results. The business turned over revenues of £87.5m in the six months to September 30. That’s up 15.6% on the same time lats year. But pre-tax losses widened by 21.5% to £6.2m from a loss of £5.1m previously.
Looking ahead, Nick Devlin, group chief executive designate, said the US market was the single most important opportunity for the business and that it he now planned to strengthen customer acquisition while adding new channels, and improving the customer proposition through measures such as recently-introduced automated ordering services. He said: “Naked has an exciting opportunity ahead to build on its community that connects over half a million wine-drinkers with over 200 of the world’s leading independent winemakers. I have been a part of that community for four years and overseen the rapid growth of the US operations for the past three.
“Naked has never been in better shape and we now have the internal capability, clarity of purpose and financial resources to take the business through its next chapter of growth. I am enormously excited to be given the opportunity to harness this platform and realise Naked’s full potential."
At the latest update of IRUK Top500 research, last January, Naked Wines was a Top500 retailer, while Majestic Wine was listed as Top250.
Image courtesy of Naked Wines