Hotel Chocolat swings to a £6.5m loss & strikes US deal with The Hut Group

// Hotel Chcolat swings to a statutory pre-tax loss of £6.5m for the year ending June 28
// However, full year revenues was up 3%, boosted by a 150% surge in online sales
// THG Ingenuity has also struck a five-year partnership with Hotel Chocolat

Hotel Chocolat has swung to a loss after lockdown hammered revenues over Easter while also revealing a five-year partnership with The Hut Group to expand into the US.

The retailer said its pre-tax profits slid by 83 per cent to £2.4 million for the year to June 28, compared with the same period last year.

However, it booked a statutory pre-tax loss of £6.5 million, compared to a £10.9 million profit the prior year.


READ MORE: 


When taking out the impact of exceptional costs, Hotel Chocolat said its pre-tax profit plunged 82.7 per cent year-on-year to £2.4 million, while underlying EBITDA came in at £9.4 million – a 54.3 per cent year-on-year drop.

Despite the declines, the retailer said profits were “slightly ahead of expectations” after taking a hit from the impact of the pandemic.

Meanwhile, group revenues grew by three per cent year-on-year to £136 million, despite its UK stores being shut for about 12 weeks of the year.

More:  Moss Bros chair Colin Porter exits as the retailer goes private

In the first half, sales increased by 14 per cent to £92 million, while sales slipped by 14 per cent to £45 million in the second half after stores closed their doors.

The retailer, which runs 130 stores, told investors that trading has been “in line” with expectations over the first 12 weeks of the new financial year.

Online sales demand is about 150 per cent higher than the same period last year, after customers turned further towards home deliveries during the pandemic.

Hotel Chocolat’s board said they believe the business is “well positioned to navigate existing and potential Covid-19 challenges”.

“Whilst uncertainty will continue for all of us in the coming year, our pipeline of potential growth opportunities has never been stronger,” Hotel Chocolat chief executive Angus Thirlwel said.

“We are working hard to anticipate potential trading scenarios for the year ahead and are planning prudently to be ready to adapt quickly and effectively as the situation evolves.

“To achieve this, we have invested in our ability to increase production and expand our supply chain capacity, as well as strengthen the leadership team to ensure a continued focus on product innovation, ecommerce, supply chain and sustainability.

“I am confident that the strategic progress we have achieved over the past year will build a stronger business in the medium-term with greater growth, profitability and brand appeal.”

More:  Amazon to buy up JC Penney and Sears department stores and convert them to fulfillment centres

Separately, Hotel Chocolat has struck a five-year partnership with THG Ingenuity – the technology arm of online retail group The Hut Group (THG) – to help it grow its reach in the US.

The agreement will launch Hotel Chocolat’s direct-to-consumer offering in the US, with the retailer accessing the full suite of services offered by the technology services division of THG.

THG Ingenuity will provide its enablement platform to Hotel Chocolat, along with digital brand services and a complete fulfilment service including chilled storage distribution.

This offers the option for product personalisation, and the use of several US warehouses to offer favourable delivery times to customers.#

with PA Wires

Click here to sign up to Retail Gazette’s free daily email newsletter

The post Hotel Chocolat swings to a £6.5m loss & strikes US deal with The Hut Group appeared first on Retail Gazette.


More from: | Category: M&A News