Majestic Wine announces store closures plan
Majestic Wine is to embark on a store closure plan as part of a wider transformation that will see the group stomach extra costs.
The specialist wine retailer did not specify the number of outlets it will close but boss Rowan Gormley said he has "no choice", adding that he will aim to "minimise job losses".
Majestic trades from around 200 stores in the UK, including in Ludlow, Shrewsbury, Wolverhampton, Stourbridge, Sutton Coldfield and Lichfield.
As part of the restructuring, Majestic will also rebrand as Naked Wines following its takeover of the group in 2015 and invest a further £6 million a year in the business.
This is expected to be funded by migrating customers and stores to the Naked brand, asset sales and high street closures.
However, the company warned that it will take a largely non-cash restructuring charge of up to £10 million this year, with further pain in 2020.
Mr Gormley added: "We also believe that a transformed Majestic business does have the potential to be a long-term winner, but that we risk not maximising the potential of Naked if we try to do both.
"Therefore we have taken a decision to focus all of our capital and energies into delivering the long-term potential of Naked, and releasing value from Majestic."
In January Majestic said that the crucial Christmas season, in which the group usually delivers around 30 per cent of its annual sales, proved more challenging than expected due to economic uncertainty and weak consumer confidence.
Majestic added it expects to meet its sales target of £500 million this year and anticipates profits, excluding restructuring charges, in line with consensus.
