Egg-free cake retailer Cake Box has been listed on the Alternative Investment Market (AIM) from today (27 June) in a move valuing the business at £43m.
Launched in 2008 in East London, the business has grown to have an estate of 91 stores, selling fresh cream cakes. Many of the cakes can be personalised with a short message free of charge, or with an image for a small additional fee, and can be collected within one hour.
All cakes are egg-free which, according to the company, enables Cake Box to target a larger potential market, including those unable to eat eggs for dietary or religious reasons.
In the year ended 31 March 2018, the group opened two franchise stores a month, on average, and the directors aim to open 250 franchise stores in the UK. The business has a manufacturing site in Enfield, which it says has capacity to support the franchise store target.
Cake Box – which announced its plans to list on AIM last week - said the average annual earnings before tax at a store was around £94,000, with mature stores showing 15% like-for-like growth. The business has grown mainly through franchise expansion and does not directly own or operate any Cake Box stores.
In the past two financial years the business has increased its revenue from £5.6m in the year ended 31 March 2016 to £12.8m, with EBITDA up from £1.4m to £3.7m.
“Over the past decade, we have built a fast-growing franchise business, with a strong financial track record and history of profitable expansion, and I would like to personally thank all Cake Box franchisees, staff and suppliers for their contributions, as well as welcoming our new investors,” said Cake Box chief executive Sukh Chamdal (pictured below), who co-founded the business with chief financial officer Pardip Dass.
“Looking ahead, we are confident that we have all the ingredients to continue to grow our franchise estate to 250 stores and further expand our slice of the sizeable UK cake market, with a unique customer proposition and limited direct competition.”
The company was named one of the 100 fastest-growing companies by turnover in the UK in the 2018 Sunday Times Virgin 100 Fast Track league table.