Hotel Chocolat Group (HOTC)

Hotel Chocolat Group HOTC Logo

Engaged in manufacturing and retailing of chocolate in the United Kingdom and overseas, it offers chocolates under the brand, Hotel Chocolat direct to customers though subscription, online and approximately 83 stores.

24-Jan-2018 – 340p – £383.6m – PER 34.5

Trading Update For The 13 Weeks To End December 2017 – Revenue up 15% and trading continues in-line with management’s expectations.

This is just way too expensive for me at these levels.

21-Feb-2018 – 325p – £366.7m – PER 32.6

Interim Results For The 6 Months To End December 2017 – Revenue up 15% to £71.7m (H1 FY17: £62.5m), PBT up 15% to £12.9m (H1 FY17: £11.2m), Net Cash of £18.3m (H1 FY17: £16.2m), EPS up15% to 9.0p (H1 FY17: 7.8p). Interim dividend, for what it’s worth, is 0.6p.

I liken this to it’s products, well overpriced for what it is.

18-Jul-2018 – 346p – £390.4m – PER 32.7

Trading Update For 12 Months To 1st July 2018 – FY Revenue up 12% to £116m with PBT expected to be in-line.

I still can’t see any value here.

25-Sep-2018 – 337.5p – £378.0m – PER 32.3

Preliminary Results For The 12 Months To 1st July 2018 – Revenue up 11% to £116.3m (2017: £105.2m), PBT up 13% to £12.7m (2017: £11.2m), EPS up about 12% to 8.8p (2017: 7.8p), Annual Dividend will be 1.7p (2017: 1.6p).

I still can’t see why people are paying up for this on a PER of 30+, I remain Neutral until it’s at least half this price.

26-Feb-2019 – 306p – £345m – PER 29

Interim Results For The 26 Weeks To The 30th December 2018 – Revenue up 13%, PBT and EPS up 7%, Net Cash up to £21.8m (from £18.3m) and the Interim Dividend sees no change. Recent trading including Valentines inline with the Board’s expectations.

A decent update but I still can’t see how this justifies a PER of almost 30.

17-Jul-2019 – 370p – £415m – PER 33

Trading Update For The 12 Months To End June 2019 – Revenue up 14% with PBT to be in-line. This year continues to be in-line.

Looks like a slight beat of Revenue but with EPS growth forecast at 7% in 2019E and 17% in 2020E I just don’t see how this justifies a PER pf 30+, my only interest here would be a Short position.

24-Sep-2019 – 370p – £417m – PER 40

Interim Results For The 6 Months To End June 2019 – Revenue up 14%, PBT, EPS and the Interim Dividend all up 10% or so. Continues to trade in-line.

Again, I don’t get the valuation here at all, perhaps I have missed something, if anything the only position I would still consider here is a Short.

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