Chocolatier Thorntons forecasts profit to rise 51 per cent

British chocolate maker Thorntons expects full-year pre-tax profit to rise about 51 per cent, in line with market expectations, and said its UK commercial channel returned to double-digit percentage revenue growth in the fourth quarter.

The company expects pre-tax profit before exceptional items to rise to £7.1 million for the year ended June 28 from £4.7 million a year earlier.

Thorntons also said it had secured support of its existing lenders who agreed in principle to provide an increased unsecured committed revolving credit facility of £75 million, running through October 2018.

"This increased facility will provide headroom for the increased working capital requirements associated with serving third-party retailers," Investec analyst Nicola Mallard said in a note.

Thorntons reported a 7.6 per cent drop in the third-quarter sales, hurt by early spring deliveries in the second quarter and lower UK commercial sales.

Consumer sentiment remained subdued in the wake of sluggish wage growth and a pick-up in inflation, prompting Thorntons to close some of its stores in the third quarter and focus on online business.

Thorntons shares were up 2.6 per cent at 109.75 pence in morning trade on the London Stock Exchange.

Reuters