Management at Patisserie (CAKE) isn't letting concerns about the UK economy get in the way of expansion plans. In the year through to September, 20 stores were opened across 12 new geographical locations, bringing the total estate to 199 outlets. The chain anticipates a similar rollout in FY2019 – and it's not difficult to appreciate the imperative. The average amount of time it took to recoup the money spent on opening a location was 23 months, beating management’s 24-month target, and all new stores were profitable from the first week of trading. Not only that, but expansion has been funded entirely from operating cash flows, which increased 10.9 per cent over the year to £24.4m.
It’s not just the retail locations that are going to plan for the Patisserie Valerie owner. Sales from online orders were up by more than a quarter to £4.8m, thanks in part to customer engagement on social media and 11.9 per cent growth in the number of Cake Club members to 404,000. The company has also started selling its products at 18 Sainsbury’s stores, which analysts called “promising”, although this new route to sales isn't material to results at this stage.
Analysts at Canaccord Genuity expect pre-tax profit of £23.4m in the year to September 2018, giving EPS of 18.8p, compared with £20.2m and 16.2p in FY2017.
| PATISSERIE HOLDINGS (CAKE) | ||||
| ORD PRICE: | 336p | MARKET VALUE: | £336m | |
| TOUCH: | 334-336p | 12-MONTH HIGH: | 381p | LOW: 253p |
| DIVIDEND YIELD: | 0.7% | PE RATIO: | 21 | |
| NET ASSET VALUE: | 92p* | NET CASH: | £21.5m | |
| Year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 60.1 | 8.2 | 8.9 | nil |
| 2014 | 76.6 | 10.4 | 10.4 | nil |
| 2015 | 91.9 | 14.6 | 11.4 | 1.67 |
| 2016 | 104 | 17.2 | 13.7 | 2.00 |
| 2017 | 114 | 20.2 | 16.4 | 2.40 |
| % change | +10 | +17 | +19 | +20 |
| Ex-div: | 11 Jan | |||
| Payment: | 9 Feb | |||
| *Includes £17.7m of intangible assets, or 18p a share | ||||
