Thorntons has seen a 11.9% first-quarter sales fall as its shift to becoming an fmcg-focussed business caused fluctuations in quarterly sales.
The chocolatier reported this morning that first-quarter sales fell by 12.8% to £20.8m in its fmcg division, with UK commercial sales plunging by 16.4%. Total company sales were 11.9% down to £41.4m as retail sales dropped by 10.9% to £20.6m.
Thorntons previously warned in its full-year results that the timing of orders in its commercial division would cause like-for-like sales volatility.
The chocolatier insisted that this sales fall would reverse in the second quarter and it expected to see UK commercial sales grow in the first half, “albeit at a more modest level due to the strong prior year comparatives”.
Thorntons added that it remained on track to hit full-year expectations of pre-exceptional profit before tax of £9.65m, rising from £7.5m last year.
Jonathan Hart, Thorntons’ chief executive, commented: “As we said in September we anticipated that sales for this quarter would be below last year as a result of the increasingly fluctuating order patterns in our UK Commercial channel. These fluctuations will become more significant within the context of the company’s performance as we continue to grow our FMCG business making quarterly comparisons less meaningful. As we demonstrated last year, these variances do not necessarily affect overall annual performance.
“We continue to make good progress with our strategy of rebalancing the business and have exciting plans in place for the key Christmas season. We remain mindful that the economic situation is still challenging for many of our shoppers and trade customers, although our growth plans do not depend on an economic upturn.”
Thorntons closed 12 stores and relocated one during the quarter as it continues to focus more on fmcg with a streamlined retail presence. Like-for-like sales declined 3.7% at Thorntons’ 249 stores.
Franchise sales declined by 19.1% due to the timing of orders and franchisees experiencing weakness in footfall, but consumer direct sales increased by 3.2%.
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