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Thorntons profits rise as turnaround continues

Chocolate maker Thorntons said it was making good progress with its turnaround plan as it reported a sharp increase full-year profits.

GENERAL MERCHANDISE

Thorntons profits rise as turnaround continues

In the 52 weeks ending 29 June 2013, profit before tax and exceptional items increased to £5.6 million from £0.9 million in the previous year, while revenues grew by 1.8% to £221.1 million.

Although total sales at the retailer’s stores declined by 8% to £102.5 million, this was mainly a result of 35 planned store closures during the year. Own store like-for-like sales fell by 0.8% although the retailer saw growth in like-for-like sales across each of its key selling periods in the second half of the financial year

Commercial sales grew by 11.2% to reach £88.7 million while franchise sales declined by 20.6% to £8.5 million, primarily as a result of the administration of a major franchisee partner in May 2012.

Thorntons said its FMCG division continued its strong growth with a 19% increase in sales and will become the retailer’s largest division by the end of the current financial year.

International sales rose from £3.9 million to £6.1 million as the retailer experienced growth in sales in Australia, South Africa and United Arab Emirates.

Jonathan Hart, Thorntons chief executive, said: "We have made significant progress in transforming Thorntons over the past year and continue to successfully rebalance revenues towards the FMCG division. This is reflected in the recovery of our profitability.

"We are on track with our store closure programme but will retain a sizeable store portfolio demonstrating our continued commitment to the high street. Here we can offer a different and personalised customer experience. We refitted 11 stores to our new format which are performing well and receive good feedback from customers.

"We are mindful that for many of our customers the economic environment remains challenging. The trading outlook is in line with management expectations and we look forward to our important Christmas season for which we have strong trading plans in place and exciting new products across all channels.

"We are pleased with the continued strength of the Thorntons brand and plans are in place to extend our transformation beyond the first three-year strategic horizon."

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