HOTEL CHOCOLAT PROMISES RAMPS UP EXPANSION PLANS AFTER POSTING STRONG PROFIT OF £24.1M

PUBLISHING DATE
March 3, 2022

Confectionary brand Hotel Chocolat is set to open more stores and create new jobs after posting strong interim sales profit of £24.1m (€28.9m) despite rising inflation.

In the six months 26 December, group revenue increased by 40% year-on-year to £142.9 million following strong multichannel growth in the UK, US and Japan. Pre-tax profit rose by 56% to £24.1m (€28.9m) and underlying EBITDA grew by 35% to £33.8m (€40.6).

Growth has come primarily from sales of its Velvetiser hot chocolate maker and also via digital and omni-channel sales. Multi-channel multi-category sales were up 24% over two years against FY20, while digital sales have been particularly significant for the brand in the US, where its unique customer levels have grown by 119%.

In the UK, there has been a 38% increase in its active customer database to 2.3 million users.

Japan’s consumer sales jumped 131%, with much of this generated through increased sales in stores, malls and franchises, the company said.

The company opened a further nine stores in Japan and is now trading from 31 locations, plus online and wholesale, with active VIP customers up by 1,000%.

Hotel Chocolat co-founder and chief executive, Angus Thirlwell, commented: “I am delighted that we have achieved a great set of results both in terms of sales and profits, indicating the global strength of the Hotel Chocolat brand and our direct-to-consumer business model. These results enable continued new job creation based in our British manufacturing operations, as well as roles in technology and multichannel retailing.”

During the period, the British brand said it increased its UK active customer base by 38% to 2.3 million. Hotel Chocolat said this was achieved through its ability to the needs of its customers and tailor its message accordingly.

Thurwell added: “The last two years have been a period of very significant change both globally and within the business as we have evolved from a UK store-led brand to a globally ambitious digital-led brand with a broad-range of luxury cacao products.”

“Since the end of the financial reporting period, trading has continued to be in line with the board’s expectations. The multi-channel performance of the UK remains encouraging, and the new markets continue to show promising potential for growth and profitability.”

Hotel Chocolat has also announced it is changing its auditing methods and is going to switch from BDO LLP to RSM UK Audit. The company said the move represented “Best practice on corporate governance.”

Hotel Chocolat’s Velvetiser – an appliance which makes silky hot chocolate, which retails for around €100, has driven the sales surge and the company has said that future stores will include cafes and offer samples of their hot chocolate made using the brand’s hot chocolate machines.

Four stores have already been expanded in the last six months with cafes and more floor space could be added. Around 50 Hotel Chocolat stores already have cafes.

A further two sites will open in the next few months, Thurwell added.

Looking ahead, Thirlwell added: “A focus on bringing happiness through chocolate in every aspect of our business model will further strengthen and nurture the appeal of our brand, helping us achieve our goal of becoming the leading global direct-to-consumer premium chocolate brand.”

He added: “We’re going to be showcasing a Hotel Chocolat ‘store of the future’ look.

“We upgraded several locations and we saw a shape of the future for stores which is basically to go for larger spaces and that’s a reflection of the shape of the business changing.

“We used to mostly be about gifting… that’s our cornerstone, but alongside that we have our home barista model and now have the ability to make bigger spaces work.”

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