Patisserie Holdings, the parent company of the Patisserie Valerie chain, has reported a 22.9% rise in adjusted EBITDA to £18.8m for the year to 30 September.
During the year revenue grew 20% to £91.9m, of which £3.6m was due to the full year effect of the acquisition of Philpotts in 2014. Online sales were up 20% to £3.1m. Adjusted pre-tax profit was up 29.2% to £14.6m.
The company proposed its maiden final dividend of 1.67 pence per share.
26 new stores were opened in the 14 months since the last reporting date all funded from operating cash flows making a year end total of 166 stores (2014:148). The group opened its first designer outlet store and second motorway service station site during the year.
It has 20 new stores targeted for financial year 2016, including a first store in Belfast and the first new Baker and Spice store since its acquisition of the premium brand in 2009, with a site in Victoria Gate, Leeds mooted.
Luke Johnson, executive chairman, said: “We are pleased to announce another record year for the Group where we have delivered excellent financial results. We strengthened our team following our IPO on AIM and have seen the benefits this year with new ideas and products enhancing our brands’ reach. We are well positioned for future organic growth and acquisitions and I am particularly pleased to be able to announce our maiden dividend. Our pipeline for new stores is strong and I am confident of another successful year ahead.”
Revenue from the 116 stores of the core brand Patisserie Valerie was £62.9m, an increase of £11.8m or 23%. The launched a number of new product lines during the year withthe most successful single offering being afternoon tea - contributing £1.2m in sales in the six months since its introduction.
Revenue from Druckers (22 stores), which is predominantly Midlands based and mainly offers a counter service, was up £0.2m to £12.4m (2014: £12.2m).
Revenue from Baker and Spice (4 stores) was up £0.2m to £4.4m in the year.
The 23-strong Philpotts sandwich retailer, bought in February 2014 for £6.3m, is now “fully integrated into the group and is operating with a streamlined back office function and is benefiting from the group’s purchasing power”. The company said it had strengthened the operations team, modified the product range and introduced the café concept to some of the larger stores which has led to improved margins. In the 19 months since acquisition, Philpotts has contributed £1.8m of profit before tax to the group.
The group’s store roll-out programme targets 20 new openings per annum and in the last 14 months it opened 26 new stores all funded from operating cash flows. Eight new stores have opened in the seven weeks post the year end with a number of these that were on track to open in FY2015, opening a few weeks later than expected due to developer delays in large new developments.
The group said its 20 FY2015 stores are located across a mixture of high-streets and shopping centres and operate from a range of different formats, from brasserie (two), full service (13) to counter service (five). Highlights from its store rollout programme during the year include: a second motorway service station store at Baldock; its first store within a designer outlet retail park in Swindon and opened its second retail park store in Romford.
During the year, the company entered into a partnership agreement with Debenhams and opened three concession its stores. It now operate concessions stores within Next, Fenwicks, Selfridges and Debenhams.
Its recent opening at Resorts World store is one of its flagship stores and offers a full brasserie menu.
The group said that all of its new stores are trading well and several stores are forecast to repay their initial capital well ahead of the 24 month hurdle rate the company’s sets for its investments. It said that these new locations noted above and their strong trading performance gave it optimism for further expansion.
The company said it continued to work hard on its pipeline, which is “well developed” to achieve the 20 store openings for FY2016. Since the year end it has opened six additional stores, exchanged contracts at four sites and are in advanced negotiations on a further eight sites. As well as some “exciting new locations” for its core Patisserie Valerie brand, including its first store in Belfast, the company is targeting the expansion of its Baker & Spice brand in FY2016, with a site in Victoria Gate, Leeds mooted.
The company invested £8m in capital expenditure during the year of which £5.5m was invested in new stores and £2.5m was re-invested in refreshing its existing estate, production facilities and upgrading our logistics fleet.
The group said it is now funded entirely by operating cash flows. It had a net cash position at the year-end of £6.1m (2014: overdraft £1.4m).
It said that its primary strategy remains that of organic growth. However, it continues to review acquisition opportunities that will add value and are synergistic with its current operations.
The group delivered its ninth consecutive year of growth in 2015 and said that this upward trend has continued into 2016 as trading to date remains positive.
Johnson said: “We have already opened eight new stores in the seven weeks since the financial year end. We have a well advanced pipeline and a healthy balance sheet which puts your company in a strong position to deliver another year of solid growth in 2016.”
The company said its online presence continued to grow with its Cake Club now at 306,000 members - a growth of 72% over the past year. its Facebook followers grew by 136% to 46,800 followers. The company re-launched its website in January 2015, featuring 360 degree virtual tours of the cafes and a “create-a-cake” feature which allows customers to design bespoke gateaux. “Create-a-cake generated £0.8m of sales since the website re-launch.
