Caffè Nero sees encouraging half-year results as sales continue to rebound

Caffè Nero sales held up during the Omicron wave, said Founder and Group CEO, Gerry Ford | Photo credit: Caffè Nero Group

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Caffè Nero is continuing to rebound from the pandemic, with the business now trading at 90% of pre-Covid levels, the UK-based coffee chain has reported.
 
For the first half of its current financial year (June 2021-November 2021), Caffè Nero reported sales of £135.7m ($184.2), an increase of 211% for the same period in 2020. Meanwhile, EBITDA exceeded pre-Covid levels to reach £29.4m ($39.9m).
 
Caffè Nero’s UberEats delivery partnership generated £3.4m ($4.6m) of revenue, with its at-home coffee offer achieving sales of £1.3m ($1.8m) over the period.
 
“We’ve seen a very encouraging first half of our financial year. Our business showed great resilience and recovery. Further, even with the emergence of the Omicron variant, our sales have held up. We are now trading at 90% of pre-pandemic levels and we expect to see that improve further over the coming weeks and months,” said Caffè Nero Founder and Group CEO, Gerry Ford
 
The encouraging half-year sales contrast with a 36% decrease in sales to £153.3m and a £16.6m loss for Caffè Nero’s financial year ending May 2021, when government trading restrictions caused the temporary closure of stores and the move to takeaway-only trade.
 
Commenting on the previous year’s performance, Dr. Ford added: “There is no doubt the pandemic and government enforced lockdowns had a significant impact on our business. The figures from our FY21 accounts show just how damaging these limitations on our trading were. We were in survival mode throughout the period. But a loss for that year of £16.6m was an improvement on the previous year, and there were signs of strengthening towards the end of the year.

"We entered FY22 with a bit of momentum, having been cash positive each month in the previous six months. Once the government restrictions came off in July 2021, our business was able to strengthen and push forward. Our first half of FY22 reflected how resilient our core business is if we are allowed to trade with few restrictions.”
 
The strong results come as Caffè Nero fully acquired Coffee#1, which operates 102 coffee shops in the UK, building on the majority stake it originally bought in 2019. Earlier in the year, the company fended off an acquisition bid by petrol station forecourt operator EG Group after successfully completing £330m ($453m) debt refinancing.
 
Founded by Gerry Ford in 1997, Caffè Nero operates more than 1,000 stores across ten countries, including more than 650 cafés in the UK.