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Coffee Heaven - A heavenly share for penny punters ? (COH)     

overgrowth - 06 Oct 2003 22:47

underground01_2.jpgA busy day in the Warsaw Underground ! Not just another coffee shop chain - this one is a brand leader and is only trading in Eastern/Central Europe (i.e. the countries recently admitted to the EU destined for substantial business growth). The company is creating new outlets at a fair old pace and take a look at their website - these are quality stores in high-profile locations like major airports, railway stations etc. Website: http://www.coffeeheaven.eu.com

APRIL 2006 TRADING UPDATE!!! Total Gross Revenues for 12 months to 31st March up 66% to £6.3M (2005: £3.8M) Lots more info. on new markets and stores click here to read the full details. Stores: 43 (up from 32) stores currently trading (Poland: 30 (up from 23), Czech Republic: 6 (Up from 2), Latvia: 7 with a further 5 units under construction including Bulgaria and sites secured in Romania (subject contract). Bulgaria & Romania are seeking to join the EU from January 2007. Sites located in key high street, shopping malls or Airport locations. Company growth target: increase number of units by at least 20 units to some 63 units by 31 March 2007. Aim being to achieve this level of growth within present Cash resources.Cash balances at 31 March 2006 were approximately £2.9M (2005: £0.7M). Debt was nil (2005: £ 2.5M): Nil Debt! Positive EBITDA: For the year ending 31 March 2006, Group EBITDA expected to be firmly positive after charging UK and new market development costs but before exceptional costs relating to the cancellation of bonds (previous Debt). Forecasts: Based on present trading conditions and current exchange rates we anticipate indicative sales of £9.3M for the year to 31 March 2007. This includes indicative sales of £0.4M from Bulgaria, which will be reported but not consolidated. From Richard Worthington (Chairman and Chief Executive): ‘The new financial year has started well. There is no doubt that the significant economic improvement in our markets is feeding through to consumer confidence and spending. The strength of the coffeeheaven brand ensures we are ideally positioned to benefit from our customers' increasing prosperity.’

Chart.aspx?Provider=Intra&Code=COH&Size=Chart.aspx?Provider=EODIntra&Code=COH&Si

kandrews250 - 28 Apr 2004 18:29 - 40 of 2037

Must admit I was worried about the fact that the company was based in Poland and finally made the jump, good point about the costs, if i remember correctly most of their last loss was due to the aim listing expenses. At this cost there can not be much downside so I will just tuck away and forget for a couple of years. As you say the problem is the cost of living over there, the only way they can make the money to attract profits suitable for UK investors will be on size / number of outlets. If the tourists do start then this may well change the turnover. We will have to wait and see. lol

overgrowth - 08 May 2004 14:51 - 41 of 2037

COH are expanding rapidly and need to ensure that they have the financing to enable them to continue with the aggressive roll-out.

The EGM allows shareholders to vote on giving the directors powers to raise capital in the most appropriate way for each new market beyond Poland.

roma - 13 May 2004 13:24 - 42 of 2037

After the drops this week, I was waiting for a drop in the offer price, looked like a good chance to top up, no such luck,only the bid price dropped, and now bid price recovered to above the closing price last week. Better luck next time maybe?

overgrowth - 11 Oct 2004 20:24 - 43 of 2037

I've still got some COH in the bottom drawer. A very informative piece in the Independent today:

http://news.independent.co.uk/business/sme/story.jsp?story=570422

stockpick - 11 Oct 2004 21:03 - 44 of 2037

Thanks for the link, I have some put away and I am a little tempted to add a few more, just think there is still a way to go so might go elsewhere for a while. LOL for the future

overgrowth - 11 Oct 2004 21:07 - 45 of 2037

stockpick - I agree, a little boring right now but a stonking great LOL for the future indeed.

pthwaite - 20 Oct 2004 10:40 - 46 of 2037

Looks like good news from COH today! 'o)

Up 7.6% so far!

http://www.moneyam.com/action/quote/showQuote?epic=COH

pthwaite - 22 Nov 2004 07:47 - 47 of 2037

I truly believe this stock will do well medium to long-term. It is not
easy to run a successful coffee busines, especially in countries such as Poland. However, the lack of major competition, and Poland's recent entry into the EU are positive factors that will push this company forward.

The market makers refuse to give this stock a decent spread; when the share price moves upward, the spread moves up to counter balance it, rather than increasing the bid price. Does anyone know why this happens with COH? Is it simply the case that COH is a risky penny share and the MM's want to make some money?

I'd be interested to hear other people's opinions on COH?

Pthwaite

shareshark - 22 Nov 2004 09:57 - 48 of 2037

Well I bought in on Friday after the interims - did an hours research and decided to buy while the price was sub 1p in 4 tranches - now holding 1m shares.

Agree with overgrowth and others - this looks a very good opportunity to buy a good sized stake in a small company in its infant stage - central/eastern Europe looks a cert for Westernisation and COH are at the forefront of entering the coffee market in these areas before the crowd - it all adds up to a great buy and hold share for the pension fund IMO.

Dave

AdieH - 22 Nov 2004 10:07 - 49 of 2037

Agree, great to get in on the bottom floor...

richie1saunders - 22 Nov 2004 21:36 - 50 of 2037

Patience will bring its reward with COH I think. A little research into the 'Good Food and Drink Guides' of Warsaw and Prague reveal some great feedback for COH stores. The concept is certainly excellent, and the team seem to have a quality product and some snappy marketing to back it up. Millions of potential and increasingly affluent customers, not much (similar) competition, huge investment into the new EU states....mmmm worth a dabble I think..patience. Incidentally I e-mailed the company recently because I was having trouble with a couple of the links on their website. Got a swift reply from Mr Worthington himself and then one from their web manager. Reasonably impressive service I suppose!

overgrowth - 22 Nov 2004 22:27 - 51 of 2037

richie - I've too experienced an excellent response from the company to enquiries and so have others - so not just a flash in the pan but part of their normal service which means that they take shareholders seriously.

I'll be adding to my holding as we see further signs of progress.

It is a long term share, but I'm sure that we'll all be more than pleased with the outcome if the company continues doing the right thing as it is now.

shareshark - 02 Dec 2004 10:27 - 52 of 2037

Hoping these drop to 0.9p offer to double up my holding - looks like T10 traders selling out who bought in at interims.

overgrowth - 03 Dec 2004 00:38 - 53 of 2037

Hmmm...I'm very tempted to double up myself also.

shareshark - 10 Dec 2004 16:29 - 54 of 2037

Decided to top up at 0.87p - no reason for the fall apart from inpatient sellers IMO.

shareshark - 13 Dec 2004 09:45 - 55 of 2037

Snapped another chunk up below 0.9p this morning - in the bottom draw for a few years now.

overgrowth - 13 Dec 2004 20:04 - 56 of 2037

shareshark - finally topped up myself at an absolute bargain 0.87p !

Some very interesting comments from Gateside on advfn:

""Parkiet reports that CHI Polska, a subsidiary of the British-based Coffeeheaven International, a company which operates the largest coffee chain in Poland, has its sights set on becoming one of the leaders in the cafe business in Central and Eastern Europe (CEE). The company currently runs a network of 22 outlets, with eight more scheduled to be opened this year. The CHI president, Richard Worthington, told Parkiet: "We believe that there is room for 250-300 of our outlets in the region from the Baltic, through Ukraine, to Bulgaria". Aside from opening its first cafes in the Czech Republic in the next few months, the company is also looking at takeover opportunities in the region. In its last financial year, which ended in March, CHI Polska recorded revenues of PLN 15.1m (3.4m), a 60% increase over the previous year."

Presently they have 33 stores open and a market cap of just over 3M. So if R. Worthington believes they can expand over 8 times... we would be looking at a Market Cap of over 20M, makes the present sub penny share price look a joke!"

shareshark - 19 Dec 2004 20:26 - 57 of 2037

This one looks a cracking bet for growth well into the future - central Europe is THE place to be getting into before the crowd and Coffeheaven is doing just that almost unnoticed.

A big player will eventually take them out for a tidy price, Starbucks maybe, but nowhere near the current price - once established this stock will be worth at least 10 times more IMO.

Now built up a decent sized holding of COH (1.75m shares at an average price of 0.94p) - if I can get 0.9p or less I will add another 250k to round it off.

Intend holding for two years plus to get the full CGT tax taper relief when they start to motor.

overgrowth - 19 Dec 2004 23:14 - 58 of 2037

shareshark - I agree, Starbucks et al will wait until they've tried to break into the same markets and finally give up and realise that Coffeeheaven are the preferred store and have all the most strategically placed sites (major airports, railway stations etc.).

10p is not as far away as it seems.

richie1saunders - 29 Dec 2004 10:19 - 59 of 2037

As the Eastern European markets expand let's hope they bring some new year cheer to COH in 2005. An overlooked share with much potential - the 'Caffe Nero' of Poland and the Czech Republic??
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