The UK-based premium chocolate and coffee retailer says year-on-year sales grew by more than a third in the year to 27 June 2022 but losses increased due to supply chain disruption and dampened direct-to-consumer trade
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Hotel Chocolat sales increased 37% to reach £226m in the 12 months ended 27 June 2022 | Photo credit: Hotel Chocolat
Hotel Chocolat has posted strong full-year sales growth despite a difficult trading environment and widening company losses.
Reporting its results for the 52 weeks ended 27 June 2022, the premium chocolate and coffee retailer said sales increased 37% to reach £226m ($271m) — 71% higher than pre-pandemic levels.
Revenue growth was predominantly driven by the company’s UK retail stores, which saw year-on-year sales increase 35%. Following the easing of pandemic restrictions, the company said the success of its 122 stores across the UK helped to offset a 13% fall in online sales during the period.
CEO Angus Thirlwell said the results indicated the UK market for the Hotel Chocolat brand is greater than the company had previously estimated.
Hotel Chocolat said the breadth of activity and pace of growth was the fastest in the group’s history.
However, Hotel Chocolat reported a ‘disappointing’ £9.4m ($11.1m) loss, which Thirlwell said was “reflective of the significant impacts of discontinuing activities in the year that had lower prospects for future returns.”
Although international sales grew 126%, supply chain disruption led to lower-than-expected profitability. As a result, the company paused further investments in international direct-to-consumer operations, both in directly controlled operations in the US and further loans to its Japanese joint venture.
In January 2023, Hotel Chocolat announced a partnership with Tokyo-based Eat Creator Corporation which will help optimise the brand for Japanese consumers.
As part of the deal, Hotel Chocolat will open 21 stores in the country.
The company also said it was taking a ‘resolute approach to cost reduction’ to mitigate current elevated levels of inflation. Nonetheless it stated that during previous periods of low consumer confidence, including the 2008 financial crisis, Hotel Chocolat grew and earned strong customer loyalty.