Weak sales at Thorntons leave investors with a bitter aftertaste
SHARES in Thorntons fell 5.5 per cent yesterday after the chocolate-maker warned that a reduction in orders over Christmas by two major buyers and problems at its UK warehouse had dented profits.
The retailer, which already issued a profit warning in December, said commercial sales made through third party retailers fell by 12.4 per cent to £54.7m after an unexpected cut in orders from two supermarket partners, which it did not name.
The company had also experienced problems at its new centralised warehouse, which meant it lost out on promotional slots and reorders.
As a result, Thorntons said profit before tax and exceptional items fell to £6.5m in the 28 weeks to the end of January from £7.2m a year earlier.
Despite a weak performance across its commercial arm, Thorntons’ retail division grew sales by 2.2 per cent after strong Christmas trading.
The company, which has been shutting down high street stores to focus on its online business, closed 16 stores in the period, and now has 247 stores. It aims to eventually have an estate of around 180 to 200 stores.
Chief executive Jonathan Hart said tough trading conditions across its commercial business had persisted into the second half and it remained cautious about its prospects for the year.