Hotel Chocolat sales boosted by roll-out of new stores
Shares in Hotel Chocolat are up nearly 10 per cent as its new locations helped deliver a double-digit rise in sales for the first half of the year.
The figures
Hotel Chocolat reported a 14 per cent increase in revenue to £91.7m, up from £80.7m in the comparable period a year before.
Underlying Ebitda rose 7 per cent to £18.5m while profit before tax was up 7 per cent to £14.9m.
The company’s interim dividend of 0.6 per share is unchanged.
Why it’s interesting
Hotel Chocolat’s double digit rise in half-year sales has been driven by new store openings, and international expansion.
In the first half of the year Hotel Chocolat opened nine new UK locations, two new stores in the US and three in Japan, contributing three percentage points to the group’s sales growth.
The group said that sales of its Velvetiser hot chocolate system had increased 200 per cent year-on-year.
Russ Mould, investment director at AJ Bell, said Hotel Chocolat’s interim results are “a bit of a treat after a day of wider market turmoil.”
“The company is doing something of a taste test of international markets, checking Hotel Chocolat actually works as a concept in the US and Japan through a handful of locations.”
He added: “Sensibly the company looks set to continue to take things slowly overseas, ensuring it has got the recipe right before commencing a more ambitious roll-out in either country.”
Shares are up 9.74 per cent.
What Hotel Chocolat said
Co-founder and chief executive Angus Thirlwell said:
This was another strong period for Hotel Chocolat. Our new store openings contributed three percentage points of the growth in the period, with the remaining balance coming from existing locations, digital and wholesale channels. While our new markets in the US and Japan are still in the early stages of development, consumer response to the brand is encouraging, sales are growing, and we believe we have a deliverable plan to achieve attractive returns.
“Our strong growth came from a wider variety of sales channels than in previous years, which led to some initial challenges in our supply chain. We are now making good progress with investments and upgrades in our supply chain which will fully address these inefficiencies and increase our international and multi-channel supply capability, ensuring we
continue to deliver profitable growth.”
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