Naked Wines shares lose their lockdown sparkle

NAKED Wines became the latest so- called ‘ lockdown winner’ to come crashing back to earth as shares fell more than 40pc.

The online wine seller warned sales could fall by up to 4pc in the year to March 2023 and it would only just break even in terms of profits. In a sobering update, the company highlighted ‘greater uncertainty’ in the economy.

Naked soared through the pandemic as customers stuck at home signed up in numbers for its home booze deliveries.

Chief executive Nick Devlin had said Norwich-based Naked would be a long-term winner, with the pandemic causing an ‘ enduring shift of demand online’.

But shares have fallen more than 80pc since last year’s highs as the end of lockdown saw demand dry up. It has issued a series of sales and profit warnings and reined in the amount it is spending chasing customers. Shares crashed 43.6pc, or 125.3p, to 162.1p.

The crash will land a big payday for hedge funds who had been betting on a fall. Naked was one of the biggest targets of short sellers, who bet against a stock by borrowing and selling it on the assumption its price will fall and they will be able to buy it back cheaper and pocket the difference.

Devlin said Naked would not ‘pursue growth at any cost’ as it continues scaling back investment in signing up new customers. The bleak outlook came as Naked reported a 5pc rise in sales to £350m in the year to March 28. Profit for the period was £2m, swinging back from a £1.5m loss a year earlier.

Naked is just the latest company boosted by the pandemic that has since crashed back down. Others include AO World (down 2.9pc, or 2.15p, to 71.55p), Ocado (up 4.3pc, or 35.6p, to 855.4p yesterday), Asos (up 4.3pc, or 36.5p, to 896p on the previous day) and Deliveroo (up 0.5pc, or 0.46p, to 88.24p on the day).

The London stock market sank into the red again as worries about a global recession haunted investors. The FTSE 100 fell 1pc, or 68.77 points, to 7020.45 and the FTSE 250 was down 1.1pc, or 198.24 points, at 18692.98.

Miners were on the slide as copper prices – often seen as a gauge of economic strength – tumbled to a 16-month low.

Anglo American dropped 4.6pc, or 146p, to 3061p, Rio Tinto fell 2.1pc, or 107.5p, to 4911.5p and Glencore was down 1.5pc, or 6.55p, at 442.8p.

The copper price decline came amid mounting fears the global economy could slide into recession as soaring inflation and higher interest rates hit households and businesses alike.

‘As interest rates rise as part of efforts to put a lid on demand, growth risks being extinguished,’ said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

Rio Tinto was also hit by a cut in its rating by analysts at Morgan Stanley.

Among the mid- cap stocks, Trainline tanked after its finance chief was poached by Boohoo.

Shaun McCabe, 53, who spent six years at the ticketing app, will step down in September to take over the same role at Boohoo.

Peter Wood, vice president of finance, will take over as interim chief financial officer while the firm chooses a successor.

The shake-up came as Trainline battles back from the pandemic. Last month, the company reported a 181pc rise in annual revenues. Shares fell 10.1pc, or 32.1p, to 284.6p. McCabe said he was ‘ very proud of the business Trainline has become’, adding: ‘It is the right time for me to pursue a new challenge.’

The appointment did little for Boohoo shares, however, with the stock down 3.2pc, or 1.94p, to 59.32p despite the announcement.