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Naked Wines (WINE) founder Rowan Gormley has announced his intention to retire from the company as the company posted a first half “broadly on track” as revenues grew and losses continued to mount.

CEO Gormley will retire when the Christmas trading season and the Majestic retail arm disposal is complete.

Naked said the decision is the conclusion of an 18 month succession planning process, with his replacement named as current COO Nick Devlin.

“Now it is time to hand over to a new team. It takes one set of skills to take a business from zero to £200m of revenues, and it takes a different set of skills to build it from there,” Gormley said.

“I am a startup guy, and Nick is the perfect leader for the next chapter of growth.”

Devlin commented: “”Naked has an exciting opportunity ahead to build on its community that connects over half a million wine-drinkers with over 200 of the world’s leading independent winemakers. Having been embedded in the business for the last four years, I have seen at first hand both Rowan and the team’s passion for transforming the wine industry in a way that benefits both wine drinkers and winemakers.

“We now have the internal capability, clarity of purpose and financial resources to achieve Naked’s full potential. I’m looking forward to working closely with the management team to harness this platform and build a business of significant scale.”

The announcement comes as Naked posted 16% revenue growth (in continuing business) to £87.5m, representing underlying growth of 13%.

This growth was driven by its largest market, the US, which was up 24% on a reported basis and 17% on an underlying basis and is “trading well on all measures”.

Investment in new customers was up 29% in the period to £10.3m, and Naked is targeting £20-25m of investment in new customer acquisition in 2020 at a lifetime payback ratio of 3.8-4.0x.

However, this increase in investment in new customers drove an escalation of annual losses.

Continuing operations adjusted EBIT was negative £3.8m compared to the corresponding loss of £1.7m last year.

Statutory loss before tax rose to £6.2m from £5.1m last year.

The £111m sale of Majestic Retail, Commercial and Lay & Wheeler and an associated property is expected to complete by the end of the 2019 making Naked a single brand and pure-play online business.

Total revenues in these discontinued businesses of £145.6m declined by 5.1% principally driven by a reduction in the Retail business of 5.3% as a result of customer uncertainty about the future strategy and ownership of the business driving lower footfall to the stores.

Gormley commented: “We have built a solid foundation for growth. Naked Wines is now a pure-play online retailer, with a huge opportunity in the US wine market, and the resources to capitalise on that opportunity.

“Trading has been broadly on track in the first half. Naked’s US business is well up on the key measures of investment, payback and sales. Consistent with our disciplined approach to investment we will slow the rate of increase of investment in new customers in the second half, due to sluggish performance in the UK and Australian markets.”

Naked’s shares are down 2.6% to 255.8p so far this morning.

Morning update

On the markets this morning, the FTSE 100 has dropped a further 0.8% back to 7,208pts.

British American Tobacco (BATS) is a rare risers, up 6.5% to 3,048p as US regulators appear to be backing away from regulating e-cigarettes. Also up are PayPoint, up 2% to 954p and Just Eat (JE), up 0.4% to 755.2p.

Fallers include B&M European Value Retail (BME), down 3.7% to 369.4p, Domino’s Pizza Group, down 3.2% to 289.4p, Tate & Lyle (TATE), down 2.4% to 690.2p and Fevertree (FEVR), down 2.1% to 1,961.5p.

Yesterday in the City

The FTSE 100 sank 0.8% back to 7,262.5pts yesterday as worries over global trade resurfaced.

FeverTree (FEVR) was in the unusual position of being rewarded by the market for issuing a profits warning, with its shares jumping 7.8% despite warning of the impact of a slowdown in its UK business. The market had been widely expecting weaker performance in the UK to hit earnings, so confirmation of a small adjustment to annual forecasts was treated as good news for the stock.

Pub and restaurant group Mitchells & Butlers (MAB) was up 5.5% to 470.5p after posting strong first half figures yesterday.

Other risers included Nichols (NICL), up 1.8% to 1,552.5p, Hilton Food Group (HFG), up 1.6% to 1,024p, Young’s, up 1.2% to 1,680p, Naked Wines, up 1.2% to 262.5p and Bakkavor, up 1.1% to 126.4p.

Travel food to go specialist SSP Group dropped 3.5% yesterday to 632p after warning that the negative headwinds from external factors it faced in 2019 would persist into next year.

Finsbury’s Food Group (FIF) dropped 2.6% to 83p after issuing a pre-AGM trading statement.

Other fallers included Glanbia (GLB), down 5% to €10.77, Kerry Group (KYGA), down 3.5% to €112.10, McBride (MCB), down 3.2% to 67.5p, Stock Spirits (STCK), down 2.5% to 196p, Pets at Home (PETS) down 2.4% to 202p and Greggs (GRG) down 1.9% to 2,012p.

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