Hotel Chocolat has posted a surge in profits as sales growth, new store openings and margin gains sweetened its bottom line.
The chocolatier said pre-tax profits doubled to £11.2m in the year to July 2, 2017, up exactly 100% from £5.6m the previous year.
Underlying EBITDA climbed 32% to £16.3m on sales of £105.2m – up 12% year-on-year.
Gross margin swelled from 66.8% to 67.9%, which Hotel Chocolat said was driven by increased efficiencies within its production line and better buying.
It also trimmed its operating expenses from 53.2% of sales to 52.4%.
Hotel Chocolat hailed the “strong” year of growth across its retail, digital and corporate channels.
The business launched 12 new stores during the year, taking its estate to 94 sites. That number now includes 15 of its shop and café stores.
‘Encouraging’
Hotel Chocolat also launched its first two franchise-operated stores in Hong Kong, as previously reported by Retail Week, as it continues to run its slide rule over potential international opportunities.
The retailer and brand said early results in its Hong Kong stores had been “encouraging”.
Online sales grew 18% during the year, as its new mobile-optimised website increased mobile conversion by 30%. Mobile devices now account for more than half of all traffic to Hotel Chocolat’s website.
As well as expanding its retail business, Hotel Chocolat is also eyeing growth within its wholesale business and has penned six new partnerships since the year end, including deals to supply Amazon, Ocado and department store chain Fenwick.
It already sells a selection of its products through concessions at high street giant John Lewis.
Hotel Chocolat co-founder and chief executive Angus Thirlwell said: “I am pleased to report another year of growth and good results. 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.”
Thirlwell 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.”
Hotel Chocolat, which floated on AIM last May, said trading had continued to be “encouraging” since the year end “despite challenges and uncertainties in the wider economy”.
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