Wine Industry Report

Majestic Wine PLC (”Majestic”), the UK’s largest wine warehouse chain, announced its preliminary results (June 19th) for the year ended 27 March 2006.

Highlights
▪ Profit before exceptional gain, tax and amortisation increased by 9.8% to £14.5m (2005: £13.2m).
▪ Operating profit up by 10.7% to £14.0m (2005: £12.7m).
▪ Total sales up 6.0% to £172.2m (2005: £162.5m). Like for like UK sales up 3.8%.
▪ Sales for the first eleven weeks of the financial year to 12 June have been encouraging, with like for like UK sales up 8.6%.
▪ Final dividend of 5.1p net per share, bringing the total dividend to 7.0p net per share, an increase of 27.3% on 2005.
▪ Good growth in number of customers on the database who have made purchases in the last twelve months, up by 20,000 to 374,000.
▪ Average bottle of wine purchased at Majestic is now £5.59 (2005: £5.51). Average spend per transaction has risen to £118 (2005: £113).
▪ Substantial increase in internet sales, orders over the web were up 38% on last year.
▪ Six new stores opened during the financial year and one re-site. We expect to increase our store openings during the coming year. Since the year end we have re-sited Cardiff and Tunbridge Wells and on 20 June 2006 will open in Bicester and East Molesey giving 129 UK stores.

Commenting on the results Tim How, Chief Executive of Majestic, said:

“We believe Majestic is in a strong position to continue to expand market share with a potential for 200 UK locations. We see good potential for the future growth of Majestic.”

Chairman’s Statement

I am pleased to announce that profit before the exceptional gain, tax and amortisation of goodwill was £14.5m, an increase of 9.8% over last year. Total Group sales were up 6.0% to £172.2m and like for like UK sales grew 3.8%.

Dividend

The Board is committed to continuing our progressive dividend policy, and so we are recommending for approval by shareholders at the Annual General Meeting a final dividend of 5.1 pence net per share payable on 11 August 2006 to shareholders on the register on 14 July 2006. This brings the total dividend to 7.0 pence net per share, an increase of 27.3% on 2005.

Board Changes

During the year we made a number of appointments to strengthen the Board.

We appointed Helen Keays as a non-executive Director on 1 November 2005. Helen, 42, is a marketing professional and brings to the Board a wide experience of several consumer sectors, including travel, retail, financial services and telecoms.

We promoted Steve Lewis on 5 January 2006 to the newly created position of Chief Operating Officer with responsibility for Majestic’s trading operations. Steve, 42, was previously our Retail Director. He was first appointed to the Board in 1998.

Justin Apthorp was appointed to the Board as Buying Director on 5 January 2006. Justin, 44, has been a buyer at Majestic since 1992 and has managed the buying department for the past three years.

People

Majestic’s greatest asset, which does not appear on our balance sheet, is its first class team of retailing and support professionals who, as ever, have worked with energy and commitment to achieve this result. I would like to thank them for making this another very good year for our business.

Current Trading

Sales growth in the first eleven weeks of the financial year, from 28 March to 12 June, has been encouraging with like for like UK sales up 8.6%.

Simon Burke
Chairman
19 June 2006