Sales of Caffè Nero products via new channels including home delivery and the supermarkets are on track to exceed £10m in the current financial year, the coffee shop said.
In the first half of the year, which covers June to November 2021, the business experienced ‘a notable and encouraging increase in several of its newly established channels’. It accrued £3.4m in sales through a delivery service with UberEats and a further £1.3m from its Coffee At Home business. The latter sees Caffè Nero’s products sold via supermarkets, Amazon, and its own website.
These new channels are now on target to generate more than £10m of incremental revenue, which the firm described as ‘a significant development since the pre-Covid period’.
The figures were revealed as part of Caffè Nero’s half-year results where it reported sales of £135.7m – an increase of 211% compared to the same period in 2020 – and an EBITDA of £29.4m, which it said was higher than the pre-Covid figure.
Caffè Nero added that its sales were ‘resilient’ during the Omicron period from December 2021 to January 2022 at 82% of ‘normal’ trading compared to FY19. It also said UK trading since January 2022 has recovered to over 90% of its pre-Covid levels.
“We’ve seen a very encouraging first half of our financial year,” said founder and group CEO Gerry Ford. “Our business showed great resilience and recovery. Further, even with the emergence of the Omicron variant, our sales have held up. We are now trading at 90% of pre-pandemic levels and we expect to see that improve further over the coming weeks and months.”
Caffè Nero, which has more than 650 stores in the UK, also reported its annual results for the financial year ending May 2021. During that period, UK sales reduced from £239.7m (FY20) to £153.3m (FY21), a decrease of 36%. This, it said, was caused by government restrictions requiring the company’s stores to be closed or to be restricted to take-away trade only and to be constrained in the number of seats allowed within the stores. The reduction of revenue subsequently meant that the group generated a loss of £16.6m for the year.
“There is no doubt the pandemic and government enforced lockdowns had a significant impact on our business,” Ford added. “The figures from our FY21 accounts show just how damaging these limitations on our trading were. We were in survival mode throughout the period.”
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