UPDATE 2-Thorntons well set for Xmas as Q1 sales rise

Wed Oct 7, 2009 9:55am BST

Quotes

   

* Q1 sales up 2.3 pct to 46.8 mln stg

* Own-store sales up 1.9 pct

* Shares up 4.9 percent at 0825 GMT

(Adds detail, CEO, analyst comments, shares)

By James Davey

LONDON, Oct 7 (Reuters) - British chocolate retailer Thorntons (THT.L) said it was well positioned for Christmas as it posted a 2.3 percent rise in first-quarter sales, sending its shares up nearly 5 percent.

"With the Christmas ranges, with the new products that we've got and all the activity planned, we're really now in a good position ahead of the key Christmas trading period," chief executive Mike Davies told Reuters on Wednesday.

He said the recent launch of a new range of 'Continental City' boxes, and planned launches in November of 'Metropolitan' chocolates and 'Melts' targeted at young women underpinned his confidence.

"We are better prepared for what might come our way at Christmas. We know it's going to be competitive," said Davies.

David Stoddart, analyst at Altium Securities, said that as the second quarter was almost twice as important as the first quarter he was leaving his year to June 2010 pretax profit forecast unchanged at 7.7 million pounds.

Thorntons, which trades from 378 stores and 199 franchises, said its total sales increased to 46.8 million pounds in the 14 weeks to Oct. 3, up from 45.7 million pounds in the previous corresponding period.

Shares in the 98-year-old firm, which have increased in value by 55 percent over the last quarter on recovery hopes, were up 5.75 pence at 123.25 pence at 0832 GMT, valuing the business at about 85 million pounds.

Own store sales increased 1.9 percent, with like-for-like sales up 1.3 percent, Thorntons Direct sales were up 2.4 percent, and sales to other retailers were up 7.2 percent.

However, franchise sales fell 15.2 percent as a result of retailer Birthdays CLCA.L, which operated 94 franchises, going into administration in May.

Thorntons' update was published as J Sainsbury (SBRY.L), Britain's third-biggest grocer, posted a 5.4 percent rise in third quarter underlying sales and as a survey showed consumer confidence rose to its highest level for 17 months in September. [ID:nL6344702] [ID:nLF558282]

Davies said he did not think Thorntons' business would be significantly affected if Kraft Foods Inc KFT.N took over Cadbury CBRY.L, Britain's biggest chocolate seller. (Editing by Paul Sandle/Will Waterman) ($1=.6301 Pound)

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