Coffee Republic chairman Peter Breach has promised to “forcefully address” the “disappointingly weak” performance of its company-owned coffee shops.
Full-year results to 30 March 2008 show the company made a net loss of £2.5m (2007: £2.42m), in the first full year since Breach and chief executive Steven Bartlett took control of the business.While overall sales – covering both franchises and company-owned stores - grew by 9% during the year, sales at company-owned stores dived by 39.8% to £5.8m.
“This has been a year of significant change with the brand now represented across the UK and in twelve countries overseas,” said Breach. “We are still in a turnaround period and our costs have continued to out-pace our income as we vigorously invest in the future of this global brand.”
Over the past year, the number of Coffee Republic outlets has more than quadrupled to 193, with major growth coming from a doubling of franchise units to 53. CR now has 10 stores abroad, with roll-out commitments for 200 stores over the next five years.
Bartlett, who has a substantial shareholding in the business, is stepping down as chief executive at CR’s AGM and will remain on Coffee Republic’s board as a non-executive director.
Breach said: “I intend to propose his appointment as vice-chairman at that meeting.”
The company said it was entering a phase of “consolidation and refinement”.