Sweet success for Thorntons as company posts 47% profit boost

Posted on 5 Mar 2014 by Tim Brown

British chocolate maker Thorntons yesterday posted a 47% rise in half-year profits after its seasonal confectionery sold better than expected over the Christmas period.

Following poor performance in 2011, the luxury chocolate manufacturer announced that it was seeking to increase its online sales while outsourcing warehousing and distribution activities in order to save £2m.

At the time, although the company had experienced an increase in sales of 1.7%, pre-tax profits decreased by 38% from £6.9m in 2010 to £4.3m in 2011.

The company’s three-year-plan seems to be paying off with adjusted pretax profits having jumped to £7.2m in the 28 weeks to January. In addition, revenues rose 4.5% to 139.7 million pounds.

Its chief executive Jonathan Hart is aiming to reposition the retailer as a food brand with international appeal.

“The response to our seasonal specialities, especially our new Snowman licensed range, exceeded our expectations,” he said. Sales to supermarkets increased 14.5% to £70.6m during the period, which meant the division overtook takings from its stores for the first time.

Hart is pushing through a store closure programme that will halve the size of the once 400-strong chain. Some 15 branches shut during the first half bringing the estate down to 281 stores. A further 25 will close before the end of the financial year. The company will make its biggest manufacturing investment in 25 years, stepping up production of Easter eggs. Shares closed up more than 2% at 157.25p.