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Majestic Wine PLC

Majestic Wine director shows faith in firm's vintage with share buy

Simon Nixon’s £130mln sale of shares in MoneySupermarket, the price comparison site he founded, was the most eye-catching boardroom deal of the week.

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Simon Nixon’s £130mln sale of shares in MoneySupermarket (LON:MONY), the price comparison site he founded, was the most eye-catching boardroom deal of the week.

He has now cashed in shares worth more than £400mln, including the £100mln he made when the business listed in 2007. 

And he sits on a further 16% of the business, worth around £175mln at today’s prices, which is subject to a six month lock-up.

While Nixon’s sale captured the headlines, a far smaller trade that slipped under the radar also provided food for thought.

On Thursday, Majestic Wine’s Justin Apthorp spent £205,000 acquiring shares in the company. 

Apthorp is the company’s director of buying (wine, not shares) and son of the former chairman John.

The purchase followed the sounding of the earnings alarm at Majestic, a previous stand-out performer on AIM and a rare commodity on the junior bourse, a dividend payer.

Apthorp’s acquisition sent out two messages. It said the Majestic director believes the stock is cheap after the £1 drop in its value to 402p following the profit warning.

And it provided a money-where-your-mouth-is vote of confidence in the retailer.

Majestic’s warning revealed a surprise slowdown in consumer demand after Christmas as it revealed annual profits would be flat.

It mirrors the experience of the large supermarket chains, which are fighting a rear-guard against the discounters.

Analysts are predicting a return to growth – but only in 2016. 

That said, the firm is well run and cash generative.

Quick facts: Majestic Wine PLC

Price: £2.60

Market: AIM
Market Cap: £1.89 m
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