Naked Wines PLC (AIM:WINE, OTCQX:NWINF)’s full-year update on Tuesday struck a “reassuring” tone as the company prepares for a key year ahead, Liberum analysts said.
Citing a 13% fall in revenue to £290 million, alongside pre-tax earnings of £5 million and £20 million in net cash, Liberum said results had been as expected in a note.
“[The] trading update provides reassurance that the group’s plan to reset its cost base has stuck,” analysts said.
Liberum acknowledged sales were expected to contract further through 2025 given smaller customer cohorts, with clarity yet to emerge on the right sizing of the business to account for this.
That said, management “are adamant” they can still be profitable at sales of £250 million, Liberum highlighted.
Liberum said information around paybacks being accepted to sell off inventory would be sought, but added it modelled for cash to build as this was carried out.
“The direction of travel appears to have improved,” analysts noted, adding clarity was now needed on “the group’s plan to reignite growth while releasing cash from inventory”.
A ‘hold’ rating with a 55p share price target is its view