Krispy Kreme UK reports full-year turnover up 9.4% to £83m: Krispy Kreme UK has reported turnover increased 9.4% to £83,052,000 for the year ending 30 December 2018, compared with £75,906,000 the previous year. Adjusted Ebitda was up slightly to £13,226,000, compared with £13,208,000 the year before. At the end of the period the company operated 124 retail locations across the UK as it added 11 sites to its portfolio. During the year the company continued to develop its off-premises business with new and long-standing partners and launched a delivery channel through its retail sites, partnering with third-party providers. Pre-tax profit was down slightly to £8,488,000 compared with £8,823,000 the previous year, according to accounts filed at Companies House. In their report accompanying the accounts, the directors stated: “The directors are pleased with the trading performance of the company and the gross profit margin of 57.5% (2017: 56.6%) reflects the higher sales and focus on controlling direct costs incurred. An exceptional credit of £98,000 has been made in the year (2017: charge of £311,000), mainly as a result of the trading performance of stores where the leases have been classified as onerous. This has resulted in an adjusted Ebitda of £13,226,000 (15.9% of sales) compared with £13,208,000 (17.4% of sales) in 2017, reflecting the ongoing expansion in the store portfolio and consequent increase in operating costs, together with an investment in central support functions. The directors consider this highly cash-generative year provides a stable platform on which the business will continue to grow as suitable retail and off-premise sites become available. The directors also intend to reinvest in the existing store portfolio and new technology, including the company’s website and information technology systems as they deem appropriate. The number of transactions has increased significantly year-on-year as we increased our availability over the UK and average transaction value in our comparable stores also increased year-on-year.” Krispy Kreme was launched in the late 1930s in Winston-Salem in North Carolina when Vernon Rudolph bought a secret yeast-raised doughnut recipe from a New Orleans chef and began selling to local stores. The UK business, which now employs almost 1,600 people, was bought by its US parent, Krispy Kreme Group, from private equity group Alcuin Capital in 2016.
AG Barr takes minority stake in zero-proof spirits brand: Funkin owner AG Barr has acquired a minority stake in business startup Elegantly Spirited, which owns the Stryyk brand. AG Barr stated: “Elegantly Spirited seeks to capitalise on the growing demand for non-alcoholic adult drinks with a new portfolio of zero-proof spirits under the Stryyk brand. As part of the minority investment, AG Barr’s subsidiary business Funkin has entered into a long-term agreement on normal market terms to act as exclusive UK distributor for all Elegantly Spirited products, in addition to AG Barr investing an initial £1m for a 20% minority stake in the new business. Elegantly Spirited is a recently formed venture from entrepreneurs Alex Carlton and Andrew King, original founders of the Funkin business. Funkin was acquired by AG Barr in 2016 and has grown strongly in the cocktail market. King has continued his involvement with the Funkin business since the transfer of ownership and will remain Funkin’s executive chairman.” AG Barr’s other drinks brands include Irn-Bru, Rubicon and Strathmore.