Hotel Chocolat had a bittersweet second half of 2022 with dents in its revenue and profits, owing to “hefty investments”, as it is not so optimistic ahead of Mother’s Day and Easter.
The premium chocolate maker reported a fall in its revenue to £129m down from £142m last year, while its gross profit was down almost £10m to £75m.
It also said it remained “cautious” about the up-and-coming holiday season, due to consumer sentiment amid the cost of living crisis.
London-listed Hotel Chocolat also said its underlying operating profit had plummeted from £26m last year to just £12m, while profit before tax had dropped from £20m to just £8m.
While insisting the cause for the drop in profits and revenue was “hefty investment”, it wasn’t all doom-and-gloom, with an uptick in UK retail, up seven per cent like-for-like.
It also reported record Christmas campaign sales with the strongest ever sell through full price seasonal products,, but online revenues took a hit as customers returned to stores instead.
This comes as millions of Brits have tightened their belts amid the cost of living crisis, as they abandon subscription services and luxury items, to try and beat inflation.
Reflecting on the results, Angus Thirlwell, co-founder and chief executive of Hotel Chocolat, heralded a “strong sales performance” saying the results reflect “hefty investments we continue to make into our brand.
“Investing in more cacao and less sugar in our recipes, funding nature positive cacao farming and championing British-made quality and design flair.
“Over the last three years, we have increased retail like for-likes by 25 per cent through product innovation and improving the quality of our database marketing.
“We have announced the opening of a further 50 UK locations over the next 3-5 years, with the first wave planned this Autumn”.
Thirlwell also said that “having grown sales by 66 per cent” from pre-pandemic levels, “we are taking this year, over FY23, to sharpen-up our operating model before we embark on the next stage of growth.”
Looking ahead, he said Hotel Chocolat “continues to trade in line with market expectations for sales though as previously guided, we remain cautious about consumer sentiment over the upcoming seasonal events of Mother’s Day, Easter, Eid and Father’s Day.