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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

paulj - 03 Apr 2007 14:19 - 560 of 2037

Thanks, AdieH. Will "Czech" it out (sorry!). As you say, the invasion by Starbucks etc was always on the cards but I'm pretty sure there'll be plenty of room - and customers - for every decent coffee concern in Eastern Europe for a good while yet. Just hope other COH holders don't get the jitters when the competition hots up, as I see that some long-termers bailed out earlier this year... and that's despite strong management, steady expansion, excellent figures, institutional backing and no real rivals.

AdieH - 03 Apr 2007 16:38 - 561 of 2037

Up 200% myself and I see alot more yet, target of 1.00 and I may think about selling out.. Been to two AGM's and very impressed with board and how they have progressed so far...

paulj - 03 Apr 2007 18:12 - 562 of 2037

Phew, can't match that, AdieH. I'm "only" up 61 per cent as I got in a little late and have also topped up several times as the sp moved up. Still, a nice healthy (paper) profit. Haven't got a target myself - that's one of my weaknesses, never know when enough's enough and it's time to offload (except on bad news or when stop-loss is breached). But 1.00 sounds suitably ambitious! Wonder when we'll get there?

AdieH - 03 Apr 2007 19:01 - 563 of 2037

18 months I would hope paul, as you say paper profit only at present but have top sliced on way also... Have met CEO who in my opinion is excellent, always responds to any emails sent, last one I recieved when I visited COH in Prague, if you want and I haven't already sent to you I can forward if you give me your email address... CFE looks interesting also but i'm waiting until it hopefully falls to 2.5p as there issuing new stock current price 3.2p approx... Good Luck.

silvermede - 30 Apr 2007 07:55 - 564 of 2037

Coffeeheaven International PLC
30 April 2007

coffeeheaven international plc
('coffeeheaven international' or 'the Company')

Trading Update year to 31 March 2007

coffeeheaven international plc, the AIM-listed speciality coffee bar business
based in central Europe, is pleased to announce the following trading update for
the 12 months to 31 March 2007.

Total store net sales up 60% to approximately 10.2M
Like- for-like sales growth 27%
65 stores trading at 31 March 2007 across 5 markets
Net cash and equivalents 1.9M at 31 March 2007

(All figures shown above are unaudited)


Sales

Total store net sales (unaudited) for the year ended 31 March 2007 were
approximately 10.2M (2006: 6.4M).

This represents a 60% increase at constant foreign exchange rates, and puts
actual sales ahead of our previously indicated full year target of 9.6M.

Group like-for-like annual sales growth (unaudited) was a robust +27% (2006:
+12% ).

Sales by market and like-for-like sales growth (unaudited) for the year to 31
March 2007 was:

Market Sales Like-for-sales growth

Poland 7.4M (2006: 5.3M) +27%
Czech Republic 1.6M; (2006: 0.7M) +39%
Latvia 0.9M(2006: 0.4M- 10mths) +16%.
Other* 0.3M ( 2006: nil) n/a as new markets
Total stores 10.2M (2006: 6.4M) +27%

*Sales from CHI Bulgaria included in 'Other' will not be consolidated (the
Company currently operates this business as a partnership venture).

The strong Group like- for- like sales growth reported for the first half year
(28%) was broadly maintained for the full year. This second half performance is
particularly strong as it is measured against a second half growth in 2006 which
was significantly higher than in the first half.

Sales growth drivers across central Europe remain:

growing awareness and appeal of the coffeeheaven brand to consumers.
continued product innovation driving additional footfall.
favourable macro-economic conditions.


Operating results:

Indicative store operating margins by market which includes the impact of 22 new
stores and two new markets opened in the period are:

Market Store EBIT margin (after depreciation)

2007 2006
Poland 20% 18%
Czech Republic 7% (9%)
Latvia 11% 6%

Indicative normalized Group EBITDA is approximately 0.95M (2006: 0.35M) and is
broadly in line with market expectations. Normalized EBITDA excludes (where
applicable) goodwill, FRS20 adjustments, unrealized exchange gains/losses and
exceptional items.

Net cash balances and equivalents at 31 March 2007 were approximately 1.9M
(2006: 2.9M).

All figures shown under the heading operating results are unaudited.

Stores

The total number of stores trading at 31 March 2007 was 65 - an increase of 22
units in the year - against our previously indicated year-end target of 63
stores.

Currently the number of trading units by market is as follows:

Poland 42
Czech Republic 12
Latvia 8
Bulgaria 3
Slovakia 2
Group: 67

Bulgaria and Slovakia were new markets opened in calendar 2006. Both represent
significant long term opportunities for the Group.

Across the Group a number of additional new sites have already been secured
(either under or subject to contract) and we are actively seeking further
locations in all markets.

coffeeheaven brand

The coffeeheaven brand continues to build traction and credibility with
customers across central Europe and the Company now commands sector leadership
in both the Polish and Czech markets.

Key to the coffeeheaven's success is our commitment to consistent quality in all
aspects of our products and service.

We were delighted that coffeeheaven baristas 'swept the board' at the recent
Polish round of the World Barista championships by taking all three top places.
The winner, coffeeheaven store manager Lukasz Jura now goes to Japan to
represent Poland in the World Championships.

This achievement demonstrates the passion and expertise we put into
coffeeheaven's training and our aspiration to maintain excellence both in coffee
preparation and customer service.

Competitive environment

As the macro-economic picture across central Europe improves, the competitive
environment in the coffee bar sector is changing.

We are seeing more interest by international coffee bar operators in central
European markets, for the most part in the form of franchise and/or joint
venture arrangements. Further in some markets local companies have also
announced plans to add coffee bars to their business portfolios.

Consumer education and awareness remains the most significant constraint to
sector growth in our fledgling markets. We believe responsible new entrants will
increase consumer awareness and accelerate sector growth from which
coffeeheaven, as central Europe's market leader, will benefit.

In these changing circumstances, maintaining the integrity and distinctiveness
of the coffeeheaven brand becomes even more important. We believe direct company
ownership to be the most appropriate long-term business model for coffeeheaven
within most markets of central Europe.

Partnership arrangements have served us well in establishing local presence in
non-European Union ('EU') markets. However following the recent entry of
Bulgaria and Romania into the EU, we have agreed with our partners in these
markets that now is an appropriate time to bring coffeeheaven's ownership to
100%. The costs involved with these transactions are not significant.

Future:

The improving macro-economic background in central Europe is feeding through to
consumer confidence and spending. We believe these favourable conditions are
likely to remain for some time to come.

Our new financial year has started well. Based on present trading conditions
and current exchange rates, we expect to maintain our unbroken historical annual
sales growth rate of around 50%.

We anticipate that the exceptionally strong rate of LFL sales growth we have
achieved (and continue to achieve) will moderate during the coming months due to
the tough comparatives we face.

Present market conditions justify an aggressive store development programme in
the coming year and we expect to enter at least one new market within the
central European region.

In order to support this expansion and our larger store base, we will be making
significant additional investments into the infrastructure of our business.

The strength of the coffeheaven brand continues to ensure that our company is
ideally positioned to benefit from the increasing prosperity of consumers in our
markets.

Your Board and our dedicated management teams across central Europe look forward
to another successful year.

stockdog - 30 Apr 2007 08:26 - 565 of 2037

Another brilliant, but solid and repeatable, set of results for 2006/7, although no mention of net profit for 06H2. I guess we will be into net profit for 07H1, from where the PE is only going one way - down.

I'm up 264% on my investment to date and can see no reason to sell.

silvermede - 04 May 2007 11:24 - 566 of 2037

Coffeeheaven International PLC
03 May 2007


coffeeheaven international plc

3 May 2007


THIS ANNOUNCEMENT IS NOT FOR RELEASE, OR PUBLICATION OR DISTRIBUTION, DIRECTLY
OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN


coffeeheaven international plc
('coffeeheaven international' or 'the Company')


Proposed Placing of up to 9.5 million new Ordinary Shares


coffeeheaven international plc, the AIM-listed speciality coffee bar business
based in central Europe, proposes to raise up to approximately 3.89 million
(before expenses) by a conditional placing by Numis Securities Limited ('Numis')
of up to 9,500,000 new ordinary shares of 1p each (the 'Placing Shares') at a
placing price of 41p per share (the 'Placing Price') principally with
institutional investors (the 'Placing'). Immediately following the Placing the
total number of issued ordinary shares with voting rights is expected to be
116,378,346.


The net proceeds of the Placing is expected to be approximately 3.69 million.
The new funds raised will be used to accelerate the Company's store development
program and new market entry within central Europe through organic growth and
acquisition.


William Currie has agreed to subscribe for 243,902 Placing Shares at the Placing
Price. This is expected to represent 0.2 per cent. of the issued share capital
as enlarged by the Placing. Following completion of the Placing, it is expected
that William Currie will own or be interested in 10,943,902 ordinary shares
representing approximately 9.4 per cent. of the expected issued share capital as
enlarged by the Placing.


Application has been made to the London Stock Exchange for the Placing Shares to
be admitted to trading on AIM. It is expected that Admission will become
effective and that trading will commence on 9 May 2007. The Placing Shares will,
when issued and fully paid, rank pari passu in all respects with the Company's
existing Ordinary Shares, including the right to receive any dividend or other
distribution thereafter declared, made or paid.


Numis has agreed conditionally, pursuant to a placing agreement dated 3 May 2007
between Numis and the Company (the 'Placing Agreement'), as agent for the
Company to use its reasonable endeavours to procure placees to subscribe for the
Placing Shares. The Placing is not being underwritten by Numis and the Placing
Agreement is terminable by Numis in certain circumstances.


Numis Securities Limited, which is authorised and regulated by the Financial
Services Authority, is acting exclusively for the Company, and for no one else,
solely in connection with the Placing and will not be responsible to anyone
other than the Company for providing the protections afforded to the customers
of Numis Securities Limited or providing advice in relation to the Placing.

silvermede - 04 May 2007 11:25 - 567 of 2037

Time to top up potentially.

AdieH - 04 May 2007 17:05 - 568 of 2037

Yes institutions willing to pay the current sp for shares, director is topping up again (he knows a thing or two)... Would like to know where the captial is going but hey trust RW with my dosh... Target of 1.00 for me and hopefully within the year... Good Luck.

David10B - 04 May 2007 19:48 - 569 of 2037

The only problem with this is yet again they come back to the market for even more money. Matters not its underwritten.

I feel they have missed the boat in not using the funds they raised 18 month ago.

Now there is heavy competition in a limited market and they have had 3 million approx just sitting in the bank----seems like living high off investors interest to me. AVIOD for the moment

stockdog - 04 May 2007 21:06 - 570 of 2037

David10B - utter crap, but respect your right to believe it.

AdieH - 04 May 2007 21:07 - 571 of 2037

Really, so are they burning the cash pile NO if you check the financials you will see the money is waiting to be invested but because its Eastern Europe there are certain difficulties with expansion etc (locations). I would suggest you do some research before sweeping remarks. If you had attended any AGMs you might have found out about the board and how they are keeping overheads to a minimum... Please also note after the last share issue the sp rose quite significantly and I would suggest by raising this amount that they have probably done due dilligence and there might be a possible buy out on the cards of other outlets in these markets...

David10B - 05 May 2007 09:45 - 572 of 2037

COH pays too much for its sites other internation companies are moving in and the locals have woken up to the fact that smart coffee shops make a buck---so they too are smarten up.

Now yopu will find that he markets are not far of being saturated and COH has no tangible assets to warrent its current value.

Also finding good paying sites is now very hard and you may have to pay throuigh the snout for them.

Then of course COH has not really turned in a profit in all their years of operations, while a Starbucks local for example makes money within the first year.

After the last share issue sure the price rose on expectations but such expectations were not forthcoming and the money sat in the bank earning directors wages.

Did a lol of research on this one and bought in at 15p to sell at 36p went to two AGMs but could never get a straight answer on Diggle investments one of my reasons for selling.

All of a sudden too Eastern Europe does not look so appealing to Western investors and COH is looking grossly over priced.

Have a great day and stay away.

AdieH - 05 May 2007 10:54 - 573 of 2037

You're entitled to your view but I believe it is wrong... Good for you for making money... I have been to the last two AGM's and I dont remember any questions relating to Diggle investments... Were you the older gentleman who praised RW on his handling of COH and the progress they have made? Anyway if you don't hold now you might have a negative slant on COH now.... Good Luck and go away...

David10B - 05 May 2007 11:17 - 574 of 2037

I take that to mean you only want to hear the good things, and not a balanced point of view taking in the negative and postive sides of an investment decision. Sorry I cant do that.

I am in fact looking to but back in around 30/35p which is more realisitic than todays price.

This further dillution will sent the share price down

AdieH - 05 May 2007 11:47 - 575 of 2037

So your current agenda is to short, have you not seen the RNS, the institutions are looking to buy the current issue at 41p... so you still believe in COH but want them cheaper... says it all really and yes I appreciate both positive and negative comments but this is blatant shorting you want stock but not at this price. At least be honest about it... You avoided my questions about the AGM, i am at least honest...

David10B - 05 May 2007 11:55 - 576 of 2037

Honest???no you must be a shareholder to be so bias and blinded by this dillution.

I dont have an agenda only here to make money.

I dont short I have no active shorts running, I seek value and my opinion is that COH is currently over valued.

If it falls to where I see value I will buy it if it does not then good luck to holders.

I dont see this discussion going anywhere so please dont reply as I have no more to say.

Save perhaps if you want a good opportunity in coffee look at CFE, at least its in an established market and has doubled my money in months.

Good luck too with COH but I only see it down from here.

AdieH - 05 May 2007 12:24 - 577 of 2037

I am a shareholder and am looking to make money (200% paper profit at present and topped sliced on way)... Suggest you move off this bulletin board as your agenda is clear, you have stated that, your opinion is this company is overvalued... Alot of the value in this company is future potential, they have reached every target they have set if not exceeded... I will defend this company and yes I hold shares... So which share holder were you at the Agenda... the miserable old sod from two years ago...

David10B - 05 May 2007 12:57 - 578 of 2037

Is there really any need to be insulting, we are only talking about differnt opinions on a share.

What I dont like about this compamny is the involvement of Diggle Investmensts, and the fact that it raised around 3 million which they used to pay off debts incurred to November 2005. The rest of the money was supposed to be used to expand but sat in the bank.

Also on Fundamentals it has little underlaying solid asset base as all its propeties are leasehold. The value maybe found in intellectual rights but the name has to be a money maker---COH is clearly not that and all quoted companies are have future potential not a lot of them make it though even though they start off with good intentions.

Diggle Investments is a substantial shareholder and as such has obviously rights to COH assets if it goes belly up (and bear in mind those who tip this company have rated it a high risk), so in the case of it folding Diggle Investments would have access to its cash, cash which was raised from sharholders who are getting no interest on it while it sits in the bank making interest for COH, which is written into the company's profits and therefore inflating the bottom line.

When COH sees some substantial profits, which it should be doing after 7 years of operations, then you can talk to me about a share price around today's levels.

Yes the share price has done well, done well for me too, but it was a rapid rise on speculation and a fall will be equally spectacular.

But then thats only my opinion.

Now why on earth should I, or indeed anyone else, move off a public BB for expressing ones point view negative or positive?

Are you the web site monitor, or an over stretched punter.?

AdieH - 05 May 2007 13:44 - 579 of 2037

Over stretched punter I am not (topped sliced on way up so my investment at present is free), an investor in COH and its future potential I am... You will still not admit if you ever attended the AGM? I again ask which investor you were or are you just saying you attended for attention... I ask you why have the institutions invested in the next placing and also W Currie if they did not see future growth in the SP, they don't invest to make a loss... Agree that I personally would have wished to see more rapid growth but the company set targets and have met those comfortably... You seem to hung up on the Diggle investment line to me its not a problem... You cannot be that bothered if you are looking for a re-entry level of 35p so please just admit that you are currently shortly and believe in the long term future of COH...
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