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Thu 19th Sep 2024 - Caffè Nero delivers strongest first quarter sales growth for five years |
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Caffè Nero delivers strongest first quarter sales growth for five years: Caffe Nero Group, the Gerry Ford-led, premium coffee house business that operates 1,072 stores across ten countries, has said it has delivered its strongest first quarter sales growth for five years. Sales in the three months to the end of August were 12.5% higher year on year, with like-for-like sales up 9.1%. The company, which opened nine new stores in the UK and Ireland during the period, reported record sales for the first three months of its financial year of £147m, driven by “very strong” sales growth in the UK of 12.5% year on year and 13.4% year-on-year sales growth at group level. Like-for-like sales in the UK were 9.1%. The company, which has more than 10,000 employees, said the performance marked a continuation of Caffè Nero gaining market share in the coffee category. UK sales were supported by 2.1% growth in footfall and “huge demand” for its cold drinks and summer sweet range. Its summer sweet range was up 11.3% year on year, with its Maritozzi Bun selling more than 200,000 units in the period. During the same period, Caffè Nero opened a further five new stores at group level across its various different territories. The business also continued its major store refurbishment programme, with 44 stores refurbished in the quarter. Of those 35 were in the UK. More than 100 further stores are scheduled for refurbishment during the remainder of the financial year as part of the group’s continual upgrading of its store estate. In the UK, Caffè Nero said it grew transactions through its mobile app with more than 35% of all UK store transactions now taking place via the app and in excess of 2.5 million people using it in the UK. Between June and the end of September, Caffè Nero also continued the expansion of its delivery sales in the UK, with delivery sales growing to more than 2% of sales, while its coffee at home offer grew by 5%. Caffè Nero founder and group chief executive, Gerry Ford said: “We have had a hugely successful first quarter, which has seen our financial year get off to a strong start. Despite the changeable weather in the UK, our summer iced drinks campaign was very successful, and customers have really taken to our summer menu, with the Maritozzi bun being a particular standout. Building on from the strong fourth quarter we experienced in FY24, these first-quarter FY25 results show we are continuing to drive real momentum and performing very well as a business. Customers are clearly demanding our hand-crafted speciality coffee, our friendly service and warm, welcoming stores. I’m optimistic that despite the impact of inflationary costs on our business, we can keep the momentum going and have an outstanding year.” Earlier this week, Will Stratton-Morris, chief executive of Caffe Nero UK, said the company's performance over the summer was one of the most positive it has been in the seven years he has been with the business. The company currently operates 630 sites in the UK under its eponymous brand, plus 110 Coffee#1 sites and around 35 Harris + Hoole locations. Speaking at the Lunch! Show 2024, he said: “The pressures on the business haven't gone away but we have stuck to our knitting and that has paid off with very positive trading, one of the most positive trading periods since I joined the business seven years ago. We are back to pre-covid levels of staff stability, which is transformational in terms of our operations. The level of repeat business has been quite exponential.” On further growth in the UK, he said: “We will look to open 30-plus sites in the UK over the next 12 months, the runway for growth here is still incredibly strong.” Earlier this year, the company opened its first drive-thru site, at Stansted airport, and Stratton-Morris said that there was “huge demand” for the business to do more. The company is currently trialling order at table through its app in its sites in Brighton, with an eye on rolling this out further within the next 12 months. He also said he did not believe subscription schemes were the “right route for coffee houses”. Stratton-Morris said: “It’s back to that point about discipline. What you don’t want to do is launch something really, really big then go back on it publicly. And worse, if [the subscription scheme] is so big and generous that you annoy all your genuinely loyal customers as all my kids are in there passing round QR codes with their mates to get free coffee, you’ve got a complete disaster. I’ve been involved in those things over the years, and I can see exactly how it happens. We don’t believe subscription is the right route in coffee houses, it may well be the right route for coffee at-home.” Caffe Nero features in the Propel Turnover & Profits Blue Book, which features 978 companies. Caffe Nero’s turnover of £450,465,000 for the year ending 31 May 2023 is the 30th highest in the database. The Blue Book ranks companies by turnover, profit and profit conversion, listing directors’ earnings for the past five years. Companies can now have an unlimited number of people receive access to Premium Club for a year for £995 plus VAT – whether they are an operator or a supplier. The single subscription rate is £495 plus VAT for operators and £595 plus VAT for suppliers. Email kai.kirkman@propelinfo.com to upgrade your subscription.
Popeyes UK people director Matt Hudson to speak at Propel’s Talent & Training Conference, open for bookings with 20% discount on tickets for Premium Club members: Matt Hudson, people director at Popeyes UK, will be among the speakers at Propel’s Talent & Training Conference. The all-day conference takes place on Tuesday, 1 October at One Moorgate Place in London and is open for bookings. The conference will showcase examples of outstanding people culture among companies within the sector and how the industry is attracting talent. Hudson will talk about evolving a people culture while opening up to 30 sites a year. For the full speaker schedule, click here. Tickets are £345 plus VAT for operators and £395 plus VAT for suppliers. Premium Club members get a 20% discount. Email: kai.kirkman@propelinfo.com to book places.
Half of heavy drinkers say calorie labels on alcohol would change their drinking habits: Half of heavy drinkers claim calorie labels on bottles would see them change their drinking habits. The Mirror reported a study by University College London surveyed 4,683 adults in England and asked about the impact of warning labels linked to piling on the pounds. Some 54% of heavier drinkers said they would make changes to their drinking if calorie labels were introduced, compared with 44% of lighter drinkers. More than a quarter of heavier drinkers (27%) said they would choose lower calorie drinks, while one in six said they would drink alcohol less often (18%) and consume fewer drinks (17%). The findings suggest calorie labels could help some drinkers maintain a healthier weight. Under current UK law, all food and non-alcoholic drinks must display nutritional information. Alcoholic products are exempt from this and only need to show the strength of alcohol, the volume of the drink and any allergens. Researchers suggested increasing the availability of lower calorie drinks as this was the most common action in response to mandatory labelling and was particularly popular among hazardous drinkers.
C&C Group appoints new non-executive director: C&C Group – owner of the Tennent’s, Magners and Bulmers Ireland brands, Matthew Clark and Bibendum Wine – has appointed Sanjay Nakra as an independent non-executive director to its board. Nakra is a senior corporate finance leader with more than two decades of investment banking experience in Europe, the US and Canada. He was managing director and co-group head, diversified industries for TD Securities from 2010 to 2021, and served as managing director and group head, technology and infrastructure, investment banking at TD Securities from 2006 to 2010. He currently serves on the board of directors of Algoma Steel Group and CGI. In addition, he is co-chair of the University Health Network (UHN) Annual Gala: Diwali – A Night to Shine, and is a member of the board of directors, chair of the nominating and governance committee and co-chair of Women Centre Stage of Soulpepper Theatre Company. Ralph Findlay, chair and chief executive of C&C Group, said: “Sanjay brings a wealth of international corporate and capital markets expertise spanning three decades which will further augment the board's existing capabilities. His corporate experience and insight will be invaluable as we progress our financial, operational and future strategic growth plans.” Nakra added: “C&C boasts a unique portfolio of iconic drinks brands and a market-leading drinks distribution business to the UK and Ireland. I look forward to joining the board and bringing my experience to bear in further enabling this unique business to achieve its full potential.”
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