Shares melt as Hotel Chocolat warns on profits

23rd Jun 2023 09:56

(Sharecast News) - Shares in Hotel Chocolat Group fell sharply on Friday, after the confectionary chain warned on profits for the second time in two months.

In a brief statement, the Aim-listed firm reiterated its plans to "re-shape the business in readiness for its next stage of growth", and said sales remained in line with market expectations.

However, despite making "excellent" progress cutting costs, it warned that cost base efficiencies would materialise later in the year than first thought, and as a result it now expects to post a "marginal" underlying pre-tax loss for the full-year.

Market expectations had been for an underlying pre-tax profit of £300,000 on revenues of £201.8m.

The firm, which grows, makes and sells high-end chocolate, also warned that sales and underlying pre-tax profits in the 2024 full-year would miss expectations, "due to ongoing weakness in consumer sentiment and continuing inflationary pressure".

As at 0930 BST, shares in the firm had lost 14% at 120p.

Hotel Chocolat first warned on profits in April after sales over Easter - one of its most important trading periods of the year - were lower than expected.