1st Oct 2009 10:57
COBURG GROUP PLC
Trading Update
1 October 2009
Coburg Group plc ("Coburg" or "the Company") will be announcing its results for the year ended 30th April 2009 by 7th October 2009. Sales are expected to be flat but with a smaller loss than the previous year. Given the economic turmoil, the Directors are pleased with the sales result. The loss, while smaller than the previous year was a disappointment and would have been considerably smaller had it not been for a very marked deterioration in the value of sterling against the dollar in the last few months of the financial year. This change substantially increased the costs of raw coffee purchases.
During the first few months of the new financial year, margins recovered following price increases and as a result, the business has traded profitably in every month so far this financial year.
Caffe Nero the Company's largest customer, has advised the Company that it intends to bring the roasting of its coffee blend 'in house' and is planning shortly to establish its own coffee roasting facility. This policy is in line with that pursued by their major competitors Starbucks and Costa Coffee.
Coburg's relationship with Caffe Nero remains positive and the Company will continue to provide services to Caffe Nero during the transition period.
The loss of the Caffe Nero business is likely to have a material adverse impact on Coburg's profitability, particularly in the financial year ending 30 April 2011. The directors have initiated a number of measures that will mitigate the financial impact of this development. Further details of Coburg's future strategy will be outlined in the Company's forthcoming annual report and accounts.
For further information please contact:
|
Chris Birkle |
Coburg Group PLC |
+44 (0)20 8317 6410 |
|
Colin Aaronson |
Grant Thornton Corporate Finance |
+44 (0)20 7383 5100 |
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