Trading Statement (7460F)

TIDMTHT

RNS Number : 7460F

Thorntons PLC

03 May 2011

THORNTONS PLC

("Thorntons" or "the Company")

THIRD QUARTER TRADING UPDATE

& INTERIM MANAGEMENT STATEMENT

Thorntons PLC today reported its third quarter trading update for the 16 weeks up to and including 30 April 2011. While overall Group sales since January were down slightly by 0.7%, the hot weather conditions over the Easter trading period significantly impacted our Own Stores, Franchise and Thorntons Direct channels.

Own Store sales declined by 13.9% to GBP31.4 million with a like for like sales decline of 12.6%. We experienced continued growth in the Commercial channel where sales grew by 25.1% and our market share in Easter seasonal lines is anticipated to have grown year on year.

The Easter trading period equates to nearly 33% of the Q3 sales in Own Stores and the weather in the Easter week contributed to a like for like sales decline of 22.8% in comparison to the same week last year. This combined with an ongoing challenging retail environment results in the Board expecting profit before tax and additional impairment charges for the year to 25 June 2011 to range between GBP3.0 million and GBP4.5 million (2010: GBP6.1 million). Through promotions we have managed our seasonal stocks well and exited the Easter period with lower levels of stock compared to last year.

Despite two key trading periods, Christmas and Easter, being affected by unprecedented weather conditions, total sales for the year to date increased by 2.9% compared to the same period last year.

Key points:

-- Total sales declined slightly by 0.7% to GBP64.2 million. For the year to date total sales increased by 2.9%.

-- Commercial sales grew by 25.1% to GBP27.7 million, with more than 98% of these sales being Thorntons branded products.

-- Own Store sales decline of 13.9% to GBP31.4 million with a like for like sales decline of 12.6%.

-- Franchise sales decreased by 21.4% to GBP2.7 million over the period.

-- Thorntons Direct sales decreased by 7.9% to GBP2.4 million with growth in the online consumer sales offset by a decline in corporate sales.

Jonathan Hart, Thorntons' Chief Executive, commented:

"The past quarter has been extremely challenging particularly in our Own Stores and for Franchisees and we foresee the prospect of this weakness in high street footfall and spending continuing. We have taken a number of actions including adjusting our trading strategy and aggressively managing our overhead costs, as well as ensuring that our production is geared to likely demand. Additionally we took steps to ensure that our ice cream was available in more stores than last year ahead of the Easter trading period. However, these significant additional sales were insufficient to offset the impact of the weather on those of our core chocolate items. The process of my strategic review is well under way and I look forward to presenting my conclusions in due course."

 
                           Q1          Q2          Q3 
                         14 weeks    14 weeks    16 weeks 
                            to          to          to      Year to 
 Sales growth %          02-10-10    08-01-11    30-04-11     Date 
---------------------  ----------  ----------  ----------  -------- 
 Own Stores               -4.3%       -6.8%      -13.9%      -8.5% 
---------------------  ----------  ----------  ----------  -------- 
 Franchise Stores         -4.8%       -5.4%      -21.4%      -9.9% 
---------------------  ----------  ----------  ----------  -------- 
 Thorntons Direct        +18.6%       +6.5%       -7.9%      +3.7% 
---------------------  ----------  ----------  ----------  -------- 
 Total Retail             -3.5%       -5.6%      -14.1%      -7.8% 
---------------------  ----------  ----------  ----------  -------- 
 Commercial Channel      +35.8%      +34.3%      +25.8%     +31.3% 
---------------------  ----------  ----------  ----------  -------- 
 Private label           -63.6%      -34.7%      -10.1%     -43.8% 
---------------------  ----------  ----------  ----------  -------- 
 Total Commercial        +29.3%      +32.1%      +25.1%     +28.6% 
---------------------  ----------  ----------  ----------  -------- 
 Total Company            +7.4%       +3.2%       -0.7%      +2.9% 
---------------------  ----------  ----------  ----------  -------- 
 Note:- 
---------------------  ----------  ----------  ----------  -------- 
 Total Company 
  excl Private label      +9.0%       +3.5%       -0.7%      +3.4% 
---------------------  ----------  ----------  ----------  -------- 
 
 
                       Q1          Q2          Q3 
                     14 weeks    14 weeks    16 weeks 
 Like for like          to          to          to      Year to 
  sales growth %     02-10-10    08-01-11    30-04-11     Date 
-----------------  ----------  ----------  ----------  -------- 
 Own stores           -4.1%       -5.9%      -12.6%      -7.5% 
-----------------  ----------  ----------  ----------  -------- 
 
 
                          Q1          Q2          Q3 
                        14 weeks    14 weeks    16 weeks 
                           to          to          to 
 Sales GBPm             02-10-10    08-01-11    30-04-11   Year to Date 
--------------------  ----------  ----------  ----------  ------------- 
 Own Stores              26.0        48.1        31.4         105.5 
--------------------  ----------  ----------  ----------  ------------- 
 Franchise Stores         2.8         5.0         2.7          10.5 
--------------------  ----------  ----------  ----------  ------------- 
 Thorntons Direct         1.3         5.1         2.4          8.8 
--------------------  ----------  ----------  ----------  ------------- 
 Total Retail            30.1        58.2        36.5         124.8 
--------------------  ----------  ----------  ----------  ------------- 
 Commercial Channel      19.8        24.6        27.3          71.7 
--------------------  ----------  ----------  ----------  ------------- 
 Private label            0.4         0.4         0.4          1.2 
--------------------  ----------  ----------  ----------  ------------- 
 Total Commercial        20.2        25.0        27.7          72.9 
--------------------  ----------  ----------  ----------  ------------- 
 Total Company           50.3        83.2        64.2         197.7 
--------------------  ----------  ----------  ----------  ------------- 
 Note:- 
--------------------  ----------  ----------  ----------  ------------- 
 Total Company excl 
  Private label          49.9        82.8        63.8         196.5 
--------------------  ----------  ----------  ----------  ------------- 
 
 
                Stores as                                        Stores as 
  Portfolio     at 08-01-11   New stores   Resites   Closures    at 30-04-11 
------------  -------------  -----------  --------  ---------  ------------- 
 Own stores        371            -           -         -2          369 
------------  -------------  -----------  --------  ---------  ------------- 
 Franchise 
  stores           229            6           1        -10          226 
------------  -------------  -----------  --------  ---------  ------------- 
 Total             600            6           1        -12          595 
------------  -------------  -----------  --------  ---------  ------------- 
 

END

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Nadja Vetter / Emma Crawshaw / Anthony Cardew

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END

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