Cake Box has a confident outlook for 2025 after continuing its positive trading momentum in franchise stores into the first half of its current financial year and improving online sales.
In unaudited H1 results for the six months ended 30 September 2024, the egg-free cake specialist posted group revenue of £18.7m, reflecting 4.3% growth compared to the same period the previous year. This was said to be driven by increased volumes from the 20 stores opened the previous year.
Pre-tax profit leapt 16.3% to £2.8m (H1 FY24: £2.4m), with gross margins rising to 53.8% (H1 FY24: 50.3%) due to continued efficiencies in production processes and the change to accounting for the national marketing levy income, which was implemented in August 2023.
Cake Box added seven new stores over its latest half-year, including entering new locations such as Crewe, Greenwich, and Lichfield – these brought its total franchise estate to 232. The company said it was confident of exceeding its target of 25 new locations by year end.
Following a £700k purchase of land for the expansion of its Bradford depot, as well as a £400k investment in the Cake Box Hub – the company’s integrated IT platforms – Cake Box reported net cash of £5.6m (H1 FY24: £5.9m).
Cake Box also unveiled over 50 new product designs and innovations during the first half, such as the five-strong cake range made in collaboration with Nutella, the Lemony Layers collection, and the new kids’ cake collection.
Among other H1 operational highlights listed by Cake Box were marketing initiatives and achievements including:
- Launching its ‘Cake Club’ customer loyalty programme
- Increasing its website views by 40% year on year, up to 2.2m
- Growing its subscription database by 40% and SMS database by 48% – up to 517k and 269k, respectively, since beginning of year
- Increasing its online sales by 16.6% year on year, with 120k new customers online
- Increasing brand awareness by 8 percentage points to 48% year on year.
“During the first half of the year, we delivered strong growth across key financial metrics and expanded our customer base, resulting in double digit increases in profits and dividends,” commented Cake Box CEO Sukh Chamdal.
“We have seen continued growth in online sales as well as brand awareness. Our store opening programme is gaining traction, with fourteen new franchise stores opening in the year to date, compared to ten by the same date last year. This has been achieved in collaboration with our external property consultants, and this success gives us confidence in exceeding the store opening target set for the year,” he added.
Cake Box noted that trading has continued improving since half-year end with total franchise sales 9.9% ahead in October 2024, online sales increasing 23%, and like-for-like sales up 4.0% compared with the same period in the prior year. It said it was on track to deliver a full year performance in line with market expectations.
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