Switch to big stores keeps life sweet at Thorntons

The group said underlying profits rose 47 per cent to £7.2m while revenues increased 4.5 per cent to £139.7m in the six months to January 11.

Like-for-like retail sales rose 2.1 per cent after a strong Christmas selling season was boosted by “outstanding” sales from its advent calendars and festive film favourite The Snowman ranges, based on Raymond Brigg’s picture book and classic film.

The group’s chief executive Jonathan Hart said the firm is looking forward to the key spring seasons of Mother’s Day and Easter with confidence.

Thornton’s commercial operation, which includes sales to other retailers such as supermarkets, reported a 14.5 per cent jump in turnover to £70.6m over the half year. This is now the biggest part of the business.

Sales in the retail division fell four per cent to £69.1m as a result of the ongoing store closure programme. The group closed 36 sites over the past year to give it 281 stores.

Thorntons goal is to whittle its estate down to a profitable portfolio of between 180 and 200 sites.

“Going forward our focus remains firmly on continuing our current strategy and maintaining the positive trajectory that we have established over the past two years,” said Mr Hart.

“As a result of the growing production volumes we are also investing in increasing our manufacturing capacity to support our long-term objectives.”

Supermarket sales rose 21.1 per cent in the 14 weeks to January 11 – Thorntons’ second and largest quarter.

Online trade was also robust, rising 27 per cent.

Analyst Nicola Mallard at Investec said: “The group’s ‘Rebalance and Grow, Revitalise and Restore Profitability’ strategy continues to deliver positive results. Thorntons continues to drive overall revenue growth and will invest in the coming years to increase capacity in key areas.

“Thorntons has delivered interim profits ahead of our forecasts.”

Analyst Simon French at Panmure Gordon said: “Thorntons has announced an encouraging set of first half results. The market place remains highly competitive but the group looks forward to the key spring seasons of Mother’s Day and Easter with confidence.”

Travelling confectioner Joseph William Thornton opened his first shop in Sheffield in 1911.