Shares plummet in Hotel Chocolat after second revenue warning in two months
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hares in Hotel Chocolat plunged on Friday as the corporate warned on income, which have been already anticipated to be slender this yr.
The firm mentioned it’s on a mission to “reshape the business” because it tries to set itself up for development sooner or later.
It is the most recent revenue warning, the second in simply two months, from the chocolate retailer, which has been fighting faltering enterprise in recent times.
Easter – a key second for any chocolate vendor – noticed gross sales “lower than expected”, the enterprise mentioned throughout its first revenue warning.
While wonderful progress has been achieved on price base efficiencies, they’re materialising later within the yr than initially anticipated
The purpose? It may merely not preserve its cabinets stocked, so clients couldn’t purchase even when they needed to.
On Friday the enterprise mentioned it’s making “excellent progress” in reducing prices, however that it is going to be slower than beforehand thought.
It implies that though gross sales are as anticipated, the corporate now expects to report a loss for the 2023 monetary yr.
It didn’t say how massive this loss is anticipated to be.
Analysts had beforehand thought that the corporate would make a £300,000 underlying pre-tax revenue. Revenues have been anticipated to be £201.8 million.
Profits subsequent yr may also be decrease than anticipated, it added.
Hotel Chocolat mentioned: “As previously announced, the 2023 financial year is a transition year to reshape the business in readiness for its next stage of growth.
“While excellent progress has been achieved on cost base efficiencies, they are materialising later in the year than initially anticipated.
“As a result, although sales are in line with market expectations, the group now expects to deliver an underlying marginal loss before tax for the 2023 financial year. Cash generation remains healthy with cash at hand of £19 million and zero debt.
“For the 2024 financial year, the group expects sales and underlying profit before tax to be lower than current market expectations due to ongoing weakness in consumer sentiment and continuing inflationary pressures.”
Shares fell round 12% on Friday morning.