Coffee bar operator Coffee Republic has nearly completed the painful restructuring programme that has seen it close 23 outlets in the past year, it said today.
The revamp, including a shift to deli-style operations, appears to be paying off, with losses for the past six months narrowing and like-for-like sales moving into positive territory.
Pre-tax losses for the six months to 26 September came in at £880,000, compared with £990,000 at the same point last year.
Turnover was also sharply down, as expected because of the reduction in the estate. It fell to £9m, against £11.4m last time around.
Chairman Bobby Hashemi said the company was now operating 49 bars, although a number were on the market, compared with 72 a year ago.
And the shift to a deli-style operation was going down well with customers, reporting sales increases of more than 20%.
Overall like-for-like sales, although flat over the six months, were improving, with third quarter sales up by 2%, said Hashemi.
During the period, Coffee Republic’s sites at Heathrow Terminal 1 and Richmond were converted to the deli concept, and both had reported “significant” sales increases since.
In the past week the Heathrow Terminal 4 had also been converted, bringing the number of delis to six.
“We are fine-tuning the deli model and have evolved the concept to ensure that the offering continues to be differentiated and profitable,” said Hashemi.
A bigger food range had been introduced, including a new range of salads, hot meats and sandwiches, he added.
Other new product ranges included hot toasties and a revamped range of muffins and cakes. Wireless and fixed internet access was also being installed in most bars.
by Nic Paton
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