Sales growth was driven Naked, which Majestic bought for £70 million in April 2015 and installed its founder, Rowan Gormley, as chief executive of the combined group.
Naked achieved record sales of £104 million, up 27% over the year, and earnings before interest were £1 million.
Majestic Retail’s like-for-like sales performance was up 4.8%, the first positive performance in four years.
But profits were dragged down by the purchase of Naked Wines.
Overall earnings before interest dropped from £21.7 million last year to £16.6 million, a fall of 21.7%, while pre-tax profits dipped sharply, from £18.4 million to £4.7 million.
Had it not been for the purchase of Naked, Majestic profits would have been down 30.3% to £15 million.
Gormley said: “We have taken the first step on a long journey. It was a good start but it is just the first step. Early signs are that the plan is starting to work.
“Strong sales figures reflect the hard work being done on the ground by the whole team. The management re-organisation is now complete, I am delighted with the teams we have in place across the group.
“At Naked Wines we had a belter of a year, breaking through the £100m sales barrier and delivering a maiden profit. We still have lots to do and although we are on course to deliver our three year plan, it won’t be without challenges.
“Trading conditions remain tough, in the UK especially, and we expect them to stay that way. Volatile currency movements will push up cost of goods. We are implementing a new supply chain and IT system, both of which are complex projects.
“Our plan, however, remains unchanged, as does our goal - £500m sales by 2019.”
City analysts reacted positively to the news.
Connor Campbell, a senior market analyst at www.spreadex.com, said: "The sound of popping corks greeted Majestic Wine’s full year figures this Monday, the stock rising over 3.5% as the company posted a 41% surge in sales to £402.1 million. Naked Wine continues to be an great acquisition for the alcohol firm, seeing its own 27% rise in sales to £104.3 million.
"Having been eyeing the company for the past month or so Spreadex’s clients took a big sip of what Majestic Wine is offering this Monday, buying up the stock around £4.60 in light of its full year success."
Investec said: "Early signs from Majestic’s transformation plan are encouraging. Customer growth has been strong, with retention and execution on investment plans key to sustainable growth against a challenging UK backdrop.
"Naked delivered maiden profits, underpinned by highly impressive ROI: the challenge for management will be maintaining this ROI as growth investment rises."
Liberum added: "The preliminary results highlight steady progress being made with the group on-track to meet its medium-term targets. The Majestic Wine business has seen positive like-for-like sales growth for the first time in four years, and Naked Wines continues to be the key engine of sales growth.
"Moreover its highly accretive investment strategy is now contributing to group profits and with debt falling quickly the re-instatement of a dividend policy will be well received.
"Majestic Wine falls into a small group of companies in the retail universe which is forecast to deliver 10% earnings CAGR, as a result of strong top line and margin growth, and is now paying a dividend alongside debt deleverage. The group is increasingly well positioned in all areas of the business and Naked Wines continues to benefit from the structural drivers of online retail growth."