UK chocolate group Thorntons today (2 July) confirmed its annual underlying pre-tax profits will come in ahead of expectations in the City, sending its shares higher.
Thorntons said higher sales and “careful cost management” had led it to generate pre-exceptional profit before tax for the year to 29 June above “current market expectations” of GBP4.6m (US$7m).
The company had said in April it was “confident” profits could come in “substantially ahead” of market forecasts. Thorntons’ pre-tax profit before exceptional items was GBP0.9m
Shares in Thorntons, which is set to provide a fuller final-quarter trading update in two weeks, were up 1.05% at 96p at 12:28 BST. At the start of 2013, the shares stood at 40.25p.
Investec analyst Bethany Hocking, who has a ‘buy’ rating on Thorntons’ shares, said the statement today was a “good end to a good year”.
“Our buy case … is predicated on the shift in the business model and the impressive margins generated by commercial. Our 100p target price was based on SOTP EV/EBITDA. Today’s statement shows further good momentum in the business and we strongly reiterate our ‘buy’ recommendation,” she wrote.