Patisserie Holdings vows to maintain pace of UK store opening programme

Patisserie Valerie

Leading UK branded café and dining group Patisserie Holdings has continued its strong performance with the opening of 12 new stores over the past six months and is on track with plans to roll-out further stores in new geographical locations.

The 12 new stores were funded from operating cash flow including two designer outlets, one motorway service station, two brasseries, two shopping centres, one new store in Scotland, three concession stores in Debenhams and its first new Baker & Spice store.

A number of the stores were strategically opened in locations where the brand did not have a previous presence, such as Preston, Durham, Cheshire Oaks and Bradford. These locations have lower rentals than more traditional larger city locations and with good sales are exceeding management’s expectations, the firm said.

Baker & Spice, the groups’ premium brand, was acquired in 2009 and operates in exclusive areas of Central London. In March the first store under this brand was opened in Brighton.

According to the company’s interim report for the six months to the end of March, the pipeline for the second half of the year looks healthy and includes a number of carefully selected new geographical areas including the group’s first store in Northern Ireland, an additional motorway service station and a factory outlet.

Revenue for the period was £50m, an increase of £6.3m or 14% year-on-year, while EBITDA reached £10.6m, an increase of 21% versus last year. Pre-tax profits hit £8.4m, an increase of 21%.

Luke Johnson, executive chairman, said: “I am delighted to announce an excellent set of results for the six months to March 2016. The Group has continued to deliver strong growth in sales and profit in what is a competitive trading environment. We opened 12 new stores in the period all of which are performing well. Our pipeline for new stores is well developed and I look forward to another period of strong growth in the second half of the year”.

Patisserie Valerie, its largest platform, delivered revenues of £35m from 126 stores during the first six months of the year, an increase of £6.1m or 21% year-on-year.

However, the company said that during the period a number of known cost pressures were experienced, including the National Living Wage.

The group said that it has “worked hard in the period to mitigate these cost pressures and through efficiencies and savings particularly in our supply chain, we have been able to improve our gross profit margin by 1% which means that our overall cost base will remain stable to the year end”.

Operating cash generated in the period was £10m and, after interest and tax payments, free cash flows available for investment were £9m.

£4.4m was allocated to property plant and equipment, including investment in new stores and a refresh of the existing estate.

Looking forward, Patisserie Holdings will continue to focus on its store rollout programme while assessing new acquisition opportunities which will add value to its operations, it said.

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