Less is more as Hotel Chocolat prepares for the festive season
The group, which has identified Yorkshire as a key area for future expansion, said most chocolate brands contain more sugar than cocoa solids and it is leading the charge to promote healthier chocolate.
The firm said sales rose 12 per cent to £91.1m in the year to June 26, with pre-tax profits leaping 181 per cent to £8.2m. The group already has stores in Leeds, York, Harrogate, Sheffield, Meadowhall, a restaurant in Leeds and a cafe in York.
Talking about the group’s Yorkshire performance, the company’s co-founder and chief executive Angus Thirlwell said: “Our latest store in Sheffield is trading strongly and we are trading well in Yorkshire. The Yorkshire golden triangle (the area between Leeds, Harrogate and York) is doing well and we have very loyal customers there.”
The trend towards reducing sugar in chocolate is something that Hotel Chocolat has been championing for the past decade, but it is only now that customers are warming to it.
“When we started on this customers didn’t get it, but we stuck with it. Now we are really getting the wind in our sails,” said Mr Thirlwell.
“There has been a market shift, led by demand from customers, who want it all - uncompromisingly luxurious chocolate that is good for them. It’s all about wellness and a responsible approach to health.”
One product that has been flying off the shelves is Supermilk, a crossover between classic milk and dark chocolate.
“It has as much cocoa as dark chocolate and it’s got milk so we can pull the sugar right back. It has as little sugar as dark chocolate and sometimes less,” said Mr Thirlwell.
Supermilk contains 65 per cent cocoa solids, 20 per cent milk and just 15 per cent sugar.
“That sugar level is really down. Petrol station milk chocolate might have 65 per cent sugar,” he added.
The group, which listed on the London Stock Exchange’s Alternative Investment Market in May, was founded in 1993 and now has 81 stores and a hotel in St Lucia on its cocoa plantation.
Talking about the festive season, Mr Thirlwell said: “Our plans for the peak winter season are well set and I am confident that our Christmas ranges will be our best ever, as customers continue to appreciate our ‘more cocoa, less sugar’ approach throughout all our categories.”
The Christmas line-up will include a Yule Log that serves 14 people and costs £20.
“It’s a patisserie idea that’s made to be shared,” said Mr Thirlwell.
“We sent some of our chocolatiers out into the woods to find some wood. Then we narrowed it down to the best log, put it through a 3D scanner and created the mould. The recipe contains high cocoa milk chocolate with ground hazelnuts and crispy bits. It’s superb to slice, the queen of pralines and it melts in the mouth.”
The group plans to launch a new website next year that can tell the story of new products such as the yule log with video showing the chocolatiers bringing their logs back.
“The new website will be able to adapt itself to any size of device so it’s as easy to view as on a classic PC,” said Mr Thirlwell.
The group said that the 181 per cent increase in profits is down to the group’s coming of age.
“We haven’t maximised profits before now, but now the growth is starting to dilute the overheads,” said Mr Thirlwell.
Analyst Wayne Brown at Liberum said: “.The outlook is one of confidence with the capital investment programme on track, store openings are ahead of expectations and plans for Christmas are well advanced. We have increased our forecasts to reflect nine new store openings versus our previous expectations of five.
“We roll our forecasts forward one year, which leads to an increase in our target price to 295p, up 23 per cent.
Consumer demand for “hedonistic chocolate” has helped drive up profits at Hotel Chocolat as it racks up new recipes.
These go to the firm’s tasting club which has thousands of members who receive monthly chocolate deliveries and recipes that receive high scores make it into the range. The group held a competition for customers and the winner was Mint Royale, a dark chocolate cup with a layer of butter salted caramel and another layer of Tazmanian peppermint white chocolate truffle. Mint Royale was entered into the prestigious Academy of chocolate Awards and won a gold medal. It is now a top seller and the winning customer gets sent regular supplies.