A 45% jump in first half pre-tax profit sees shares in café and casual dining group Patisserie (CAKE:AIM) climb 4.6% to 292.8p.
Pre-tax profit at the Patisserie Valerie owner reached £7 million in the six months to 31 March, up from £4.8 million the previous year, with revenue growing by 22.2% to £43.7 million.
Chief executive Paul May says the growth in revenue was driven by 10 new store openings, the integration of the Philpotts premium sandwich retailer it acquired last year and a mixture of increased footfall and customer spend.
Revenue at its 106 Patisserie Valerie stores increased by 18.8% to £28.9 million, helped by its new afternoon tea offering, seasonal menus and voucher deals via sites such as Amazon (AMZN:NDQ).
The company is in advanced discussions to secure new sites which will enable it to deliver its 20 store target for the year.
‘If we open 20 stores a year and pay a dividend we will accumulate cash and we’ll have to think about how we spend that – we might make an acquisition or open further stores. We are absolutely keeping an eye open for acquisitions,’ says May.
Patisserie is also looking at introducing takeaway coffee, which May says will give it the opportunity to compete with Costa and Café Nero in the early mornings.
Cantor Fitzgerald expects the consensus pre-tax profit forecast for the full year to increase by 6% to £15 million following today’s update. This would be a rise of 44% from 2014’s pre-tax profit of £10.4 million.
Patisserie’s share price has risen by 40% since December and Cantor Fitzgerald reckons it could grow by a further 19.5% to 350p.
Read our recent interview with Patisserie to learn more about the company's strategy.