Hotel Chocolat Group PLC (LON:HOTC) saw profits double last year as revenues smashed through the £100mln barrier but warned that there were wider economic “challenges and uncertainties” ahead.
The chocolatier, which floated last May, saw pre-tax profits soar to £11.2mln (2016: £5.6mln) in the year to 2 July 2017, boosted by the addition of 12 new stores.
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That came on revenues of £105.2mln – a 12% year-on-year increase (2016: £91.1mln)
Underlying earnings (EBITDA) was up by a third to £16.3mln (2016: £12.4mln), while earnings per share doubled to 7.8p.
As a result of the strong performance, Hotel Chocolat declared a maiden dividend of 1.6p per share.
Shop+café format proving popular
“The Hotel Chocolat brand has continued to strengthen and we have made excellent progress with our three strategic priorities of investing further in our British chocolate manufacturing operations, growing our store estate and developing our digital offering,” said chief executive Angus Thirlwell.
“All our channels are growing. In retail, the new Shop+cafe format is proving popular, our new website has improved conversion on mobile devices and since the year-end, we have signed six new wholesale accounts that will make it easier for consumers to buy Hotel Chocolat products.”
He added: "Given the encouraging performance of our retail and internet channels, along with the pipeline of opportunities ahead of us, we are confident of further growth. This of course depends on the availability of suitable sites.”
Amazon and Ocado now sell Hotel Chocolat goods
Hotel Chocolat said its market research found that a “lack of access” was stopping people from buying chocolate more frequently from the company.
To try and combat this, the group has signed deals with Amazon and Ocado recently which should open up its offering to a wider audience.
Last year, sales of Christmas ranges “traded strongly” and HOTC is already busy preparing its “biggest ever seasonal offering”. By the time the holiday period comes around, the company hopes it will have another eight stores open.
‘Challenges and uncertainties’
Trading since the end of the year has been “encouraging” the firm said, although there was hint of caution.
Chairman Andrew Gerrie noted the “challenges and uncertainties of the wider economy”, and recent economic data has suggested the average UK consumer is seeing a reduction in spending power.
That said, he was still confident that the company was “well positioned” for future growth.
Shares were down almost 1% in morning trading to 291p, although analysts at Liberum said the recent share price weakness was “unwarranted”.