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Cake Box shares gain as it dishes up strong earnings in first results since IPO

The market value of Cake Box has grown 66% since it started trading on the London Stock Exchange

Cake Box
Trading in the first eight weeks of the second half has been "encouraging"

London cake retailer Cake Box Holdings PLC (LON:CBOX), which listed on London’s junior market AIM in June, served up a 34% jump in pre-tax profit for the first half as store openings and new products lifted revenues.  

Adjusted pre-tax profit, excluding initial public offering costs of £599,000, rose to £1.97mln in the six months to September 30 from £1.47mln a year ago.

Revenue gained 44% to £8.28mln as 15 new franchise stores were added in the period and as new product ranges, including caramel and chocolate cheesecakes, were well-received by customers.

The total turnover of franchisees rose 29% to £14.1mln with like-for-like sales up 4.4% and online sales up 86%.

The company declared an interim dividend of 1.2p after ending the period with net cash of £800,000, compared to a debt of £400,000 last year. Underlying operating cash flow rose to £1.62mln from £1.33mln a year ago.

READ: Cake Box enjoys sweet AIM debut 

Looking to the rest of the year, chief executive Sukh Chamdal said: “Our performance during the first eight weeks of the second half has been encouraging and we have already opened four new stores."

Chamdal added: “The group is well placed for further progress and the board remains confident of another successful year of growth." 

Shares gained 3.8% to 182.8p in morning trading.

"With the important Christmas and New Year period to come, we retain our recently upgraded forecast at earnings per share of 8.1p though upward pressure remains and medium-term valuations appear undemanding," said house broker Shore Capital. 

The group’s floated about 41% of the business on AIM in June, valuing it at about £43mln based on a placing price of 108p. The company now has a market capitalisation of about £71.5mln. 

Quick facts: Cake Box Holdings PLC

Price: 188 GBX

LSE:CBOX
Market: LSE
Market Cap: £75.2 m
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