Chocolate retailer Thorntons today cited unsuitable weather conditions during key holiday periods and low footfall on the UK high street as major factors in its profits dropping from £6.9 million to £4.3 million over the last year.
According to a trading statement published this morning, the confectionary specialist saw total retail sales fall 8.2 per cent to £139.5 million and like-for-likes decline by 7.9 per cent for the 52 weeks to June 25th 2011.
With own store trading slipping 8.9 per cent to £118.3 million over the period, Thorntons recently announced that it will be embarking on a new business strategy over the next three years, which could see up to 180 stores closed on high streets across the UK and a greater focus on improving its customers’ brand experience.
A much greater focus on the company’s online offering, Thorntons Direct, and an increased commitment to commercial sales through Britain’s major supermarkets is also part of its restructuring plan.
The fragility of the firm was highlighted today by the CEO Jonathan Hart’s assertion that poor weather over the Christmas 2010 period and unseasonably hot conditions last Easter did not help sales at Thorntons.
And as has been the case for many other UK high street mainstays, the general reduction in retail footfall nationwide combined with low consumer confidence levels across the country has made trading conditions very tough for the chocolatier.
Hart, who joined Thorntons from his position as Managing Director of coffee chain Caffe Nero at the turn of the year, remained upbeat about his new business’s fortunes and welcomed the 1.7 per cent increase in group revenues over the course of 2010/11.
He also pointed to encouraging early signs regarding the retailer’s turnaround strategy, saying that a number of new initiatives, such as new store designs and visual merchandising displays, have already been introduced and well-received by customers
“In the year that marks the centenary of Thorntons, I am pleased to report record overall sales, despite the challenging retail environment,” he added.
“As announced at the time of our strategic review, our goal over the next three years is to rebalance the business and to create a profitable and sustainable retail estate.
“While we expect to see the weakness in high street footfall and consumer spending to continue through 2012, we are confident that this strategy is right for the company.”