Costa underlying profit up 20.5%

21 October, 2014

Costa Coffee growth continued in H1

Costa Coffee, the Whitbread-owned chain, saw its first-half underlying profit increase by 20.5% to £52.4m, it revealed today.

Unveiling its results for the six months to 28 August, the company said Costa’s sales during the period had also increased by 15.6% and like-for-likes were up 6.1%.

It said LFL growth had been driven by a transaction increase of 5%.

In a statement, Costa said: “This investment in organic growth, innovation, our teams and our stores has enabled us to increase our share of the UK coffee market and to build market-leading customer preference for our brand. The coffee shop brand preference survey (as conducted by YouGov) rates Costa as the clear number one.”

The coffee chain opened 85 net new stores in the first half, taking its total number of stores to 1,840 and added it was on track to achieve more than 2,200 stores by 2018.

System sales at its franchise stores grew by 5.1%, at a constant currency, during the first half of the year.

Exciting

Commenting on international growth, Costa added: “China remains an exciting profit growth opportunity and we have a total of 335 stores, delivering mid-single-digit like-for-like sales growth. We are making good progress with the profitability of our like-for-like estate in China, which gives us the confidence to continue to invest in new store openings, to build the critical infrastructure and to invest in the management capabilities and resources required for future profit growth.

“Following a period of geographic extension into new provinces, our current focus is to build scale in the cities where we are already present and we expect to open around 40 net new stores this year.”

Overall Whitbread saw its total group revenue increase by 13% to £1.2bn.





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