Chocolate maker and retailer Thorntons [IRDX RTHN] is preparing to launch a new transactional website as it looks to focus on a multichannel future in which other retailers represent its main sales channel.
The company today said it was committed to a rebalancing strategy that includes closing stores, revitalising the brand and restoring profitability and will see most of its sales coming through its commercial sales to third-party retailers such as supermarkets.
In its results for the half-year to January 7, the company reported sales of £130.0m, down from £133.5m at the same time last year. Pre-tax profits before exceptional items fell 63% to £3.1m, from £8.4m last time. After exceptional items, the fall was in the order of 93%, to £0.6m, from £8.3m last time.
Thorntons said sales in its online channel, Thorntons Direct, grew by 4.6% to £6.7m in the half-year, up from £6.4m last time. Online sales to consumers grew by 13% in the second quarter of the period. It said a new website would launch after Easter.
The company said its vision of a sustainable and profitable business would leverage “the strength and flexibility of our multichannel approach.” Over the next three years the company will close at least 120 stores, and possibly as many as 180, to create a network of around 200 stores in “sustainable retail locations” that would act as shop windows for the brand.
By the end of that period it is envisaged that most of its sales will come through its commercial channel, which accounted for 37.2% of sales in the period, up from 33.9% at the same time last year.
Chief executive Jonathan Hart said: “We are pursuing our chosen strategy and have made good progress in implementing it while weathering a difficult market. These results and the economic climate only reaffirm the need for change.
“We have a well-managed balance sheet, quality asset-backing and good cash generation. The board is confident that Thorntons has the expertise and the resources to successfully complete this transformation and restore profitability.”