20th Mar 2020 12:12
Alliance News) - Hotel Chocolat Group PLC said Friday its trading since March has been hurt by spread of Covid-19, so is launching a GBP20 million placing.
The chocolatier said its trading, both in the UK and in the US and Japan, had been "encouraging" up to the end of February with revenue having increased by 6% year-on-year in February.
However, in March-to-date Hotel Chocolat said its trading has "inevitably slowed". As a result, retail revenue is down 5% year on year.
"With the increasing possibility that the UK Government will impose further public health measures, the group anticipates the ongoing effect of Covid-19 and the continued reduction in high-street footfall is likely to result in some or all of the company's stores being closed for a period, which will impact company sales and profits. Mother's Day and Easter, two important trading periods for the company, typically contribute about 12% of the group's annual revenue," the company added.
Hotel Chocolat said it has many measures at its disposal, and maintains a "strong" relationship with its lending bank. The company also noted it is taking proactive measures to reduce costs, optimise working capital and preserve cash.
One such measure, is the GBP20 million placing announced Friday.
Hotel Chocolat will issue 8.9 million shares at 225 pence each. Liberum Capital is acting as sole broker for the placing.
Shares in Hotel Chocolat were 0.2% higher in London on Friday at 232.50 pence each.
The company said the proceeds from the placing will be used to shore up its resilience and aid its growth plan.
"The Hotel Chocolat brand is strong and the company's longer-term growth plans and opportunities in the UK, the US and Japan remain unchanged. During these uncertain times the company continues to remain focused on protecting its staff and customers," the company said.
By Paul McGowan; [email protected]
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