Hotel Chocolat boss warns of melting profits next year amid cost of living crisis
Hotel Chocolat revenue has risen more than a third over the past year, as it braces for a spending slow down amid the cost of living crisis in the UK.
Revenue hit £226m in the 12-month period, up from £165m a year prior and ahead of market forecasts.
However, co-founder and CEO Angus Thirlwell said in a statement this morning that the company expects “temporary lower sales growth rate and profit margin” next year.
While the UK’s current economic climate will be bad news for retailers of non-essential items, like chocolate, Hotel Chocolat has doubled down on its presence in the country.
“We have discovered that our UK market can be a lot bigger for us than we thought a year ago, thanks to the new drinkable chocolate products (Velvetiser & Velvetised Cream alcohol) and the way our digital and stores businesses are performing,” added Thirlwell.
It comes as the chocolatier wraps up its US operations, with bosses expecting to close its last remaining store in the country in the first half of next year and transition to a purely online business in the States.
The shrinking of its brick-and-mortar chain forms part of plans to de-risk its global growth strategy as market turbulence extends beyond the UK – with the goal of posting higher profit growth in 2024 and 2025 as it navigates rising inflation and a looming recession.