The donut and coffee business has posted positive second quarter growth, crediting its omni-channel retail strategy as a key strength in navigating rising commodity and labour costs
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Photo credit: Ben dutton
Krispy Kreme has said it is in a strong position for growth in the next five years after reporting positive second quarter revenues. However, the JAB Holdings-backed donut and coffee business acknowledged rising commodity costs and pressures on consumer spending as key headwinds facing the business internationally.
Total net revenues grew 7.5% compared to the same period in 2021 to reach $375.2m, with Krispy Kreme’s largest US and Canada business unit achieving 8% growth to $250.5m compared a year ago. For the first half of 2022, year-on-year net revenue grew 11.4% to $747.8m.
Total net loss for the quarter was $2.4m compared to $15m the second quarter of 2021.
However, the first half of 2022 yielded a positive net income of $4.1m compared to $15.4m loss during the same period of 2021. Across the US and internationally, individual store sales rose more than 20%, the company said.
“Our results in the second quarter continue to demonstrate the benefits of our omni-channel model and global expansion strategy with strong organic growth,” said Krispy Kreme President and CEO Mike Tattersfield.
“In the second quarter consumers faced unique economic pressures, which is why we invested in our customers through Acts of Joy such as Beat the Pump dozen pricing that matched a gallon of gas and other promotions to drive brand love. After the end of the second quarter, we took successful pricing actions in the US and UK markets and we have seen a significant deceleration in key commodity costs for 2023 in recent weeks,” Tattersfield added.
Krispy Kreme increased the total points of access – retail channels where its products can be purchased globally – to by 328 to 11,409 locations.
The chain also added net 100 stores over the year to reach 11,836 outlets, with 5,520 in the US and Canada, and 3,003 located across its international markets.
Krispy Kreme also now operates 32 mobile food trucks and vending machines, predominantly in Japan.
In July 2021 Krispy Kreme
launched a $2.7bn IPO, marking its return to the stock marker five years after it was taken private by JAB Holdings as part of a $1.4bn deal.
In December 2021, JAB said it intended to be an ‘anchor shareholder’ in Krispy Kreme ‘for many years to come' after increasing its stake in the company to 45%.