Naked Wines FY25 Results: Loss Narrows, Cash Flow Improves, Shareholder Distributions Commence

Right, let’s pop the cork on Naked Wines’ full-year results. After a turbulent few years, this feels less like a standard earnings report and more like a carefully orchestrated comeback tour. Under new CEO Rodrigo Maza and CFO Dominic Neary, the focus has shifted decisively: less frantic growth, more financial discipline. And the numbers? They’re telling a story of stabilisation, cash generation, and – crucially – the return of shareholder distributions. Let’s dive in.

Financial Performance: Losses Narrow, Cash Flows Improve

First, the headline act. Revenue landed at £250.2 million, down 14% year-on-year. That’s not pretty, but it’s exactly where management guided – and importantly, it’s an improvement on the 18% decline seen in FY24. The revenue drop stems from three main factors:

• The COVID hangover: Attrition from those massive FY21/FY22 customer cohorts (acquired during lockdowns) is finally easing.
• Strategic pullback: They deliberately cut inefficient marketing spend in Q3/Q4 FY25, sacrificing some volume.
• External pressures: No Easter trading in the UK financial year and broader economic headwinds played a role.

Profitability & Cash: The Real Wins

Where the narrative gets interesting is beneath the top line:

• Loss Before Tax: Sharply reduced to £4.9 million (from £16.3 million in FY24). This excludes a £9.9m impairment charge from the prior year, but still shows progress.
• Cash is King (and Queen): Net cash (excluding leases) surged to £30.1 million (up £10.5m YoY). Free cash flow was the star – £18.5 million generated, nearly triple the £6.7m in FY24. This was overwhelmingly driven by slashing inventory.
• Adjusted EBITDA (ex-inventory costs): £6.7 million, down from £8.7m but in line with guidance. Gross margin held relatively steady at 18.4%.

The standout achievement? Inventory reduction. Total stock (including winemaker advances) plunged by £37 million to £108 million. This wasn’t painless – it cost £6.5 million in liquidation charges – but it’s fundamental to unlocking cash and right-sizing the business.

Operational Reset: Leadership, Retention & The Core

Beyond the numbers, Naked’s rebuilding its foundations:

• New Leadership, New Culture: Maza and Neary have rebuilt the exec team, embedding a “data-led, high-performance culture.” Transparency and discipline are the new mantras.
• Member Retention Holds Firm: 75% retention rate (unchanged YoY). Crucially, profitable core members (those with >24 months tenure) generated over £40 million in repeat contribution – the engine room of the business.
• Customer Love is High: Net Promoter Score (NPS) jumped to 76 (“excellent”), up from 73. Customers who stick around really like the offering.
• Acquisition Cost Creep: Customer Acquisition Cost (CAC) edged up slightly to £74 (from £73). Reducing this is a stated priority under the new marketing strategy.

Maza’s emphasis on “testing, learning, and doubling down on what works” signals a pragmatic, less scattergun approach. Australia even returned to membership growth – a small but symbolic win.