A 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.’

Your turn,you're the one saying it's not worth the price.I'm just seeking to discover the fair price. What is your net profit / store ?

When COH tells us the nett each store then I can tell you.

Time for night night old chap, tomorrow is another day, or was that yesterday?
(scratching his head).

If you cannot give a figure how can you say it's overpriced ?

and how can one evaluate anything without knowing at least gross or better still, nett margins?

Well cynic it really is most gratifying to see another, obviously intelligent person, understanding that .

Thank you for your perception.

anyone other than someone blind for real or self-delusion is all that is required!

The important bit is at the bottom of the page!

This is the link to authenticate the article pasted below:-

http://gielda.wp.pl/POD,6,a,1,b,1,c,11,index.html?P%5Bnumer%5D=8883023&P%5Bobr%5D=ifx&ticaid=13d38


U.S. coffee chain Starbucks enters CEE market through Polish listed restaurateur AmRest 14:51 28.05.2007
poniedziałek

Polish listed restaurateur AmRest has sealed a joint venture agreement with U.S. coffee chain Starbucks, paving way to launch Starbucks stores in Poland, the Czech Republic and Hungary, the company said in a communique Friday.

The parties resolved to establish three separate Joint Venture Companies, one for each of the three countries in the Territory [Poland, the Czech Republic, Hungary]," the communique reads. "AmRest Poland shall contribute 82% and Starbucks 18% of the capital to the JV (joint venture) Companies."

Starbucks has the right to increase its share in the joint venture companies up to 50% in fifth and ninth year of their operation, or in the third and fourth year if AmRest fails to open the agreed minimum number of stores.

This is RW's comment on the Starbucks news:-

"We have of course been aware of this for sometime and have planned accordingly. The only surprise why it has taken SB so long to come to CE and the size of the royalties Amrest is paying to SB at 6% - we had expected 5%.

That's a huge burden for any business to carry given the margins.

As usually the likely winners out of this will be Starbucks with the franchisee carrying all the risk. Amrest are developing a number of brands like KFC/Pizza Hut as well as their own brands all in several CE markets. A lot of plates to keeping spinning with conflicting demands for capital.

What is important to us is that this is not SB but an SB franchise. In CE we believe that is a critically important difference for many reasons. As we have said many times we do not believe franchising is the correct business model for coffeeheaven in CE today.

In essence nothing changes for coffeeheaven. Most likely SB's entry will expand CE market growth and as sector market leader in CE coffeeheaven will be the biggest beneficiary.


Sincerely
Richard Worthington


I mr Worthinton's comment lay the secret of COH making or breaking.

Mr Worthington refers to, and I quote :- That's a huge burden for any business to carry given the margins.


Form this it is easy to deduce that COH are keenly aware of profit margin and have not cracked to problem in order to move COH into a comfortable NETT profit zone.

Thye have failed to do this up to now depite have little or no serious competition in Western styles coffeee bars---Now the competition is begining to roar, will Mr Worthington be unable to cower in the corner?

I wonder, as to date COH has only proven its worth in fund raising from its shareholders.

I wonder further if EMPIK were already aware of this when they dumped their major holding, as perhaps they saw no future with COH.

TIME WILL UNDOUBTED BE THE BEST JUDGE.

as with SEO and BFC???

DONT FOLLOW YOU.

"time will tell" whether this company is worth any more than the 2 i mentioned - i.e. FA.

I am far from convinced that this niche market has room for tiddlers.

Come on 10B you haven't given any justifiable figures yet.Are you capable of simple analysis.I can help you on Gross margins if you want.All you do is look at the GM's for the preceeding years,look at the trend and say whether you thing they should increase or decrease. Then you apply that to the sales figure i.e. if its 60% or 70% you multiply the sales by .6 or .7.Still with me ? Then you divide the GM by the number of store equivalents.Sounds technical I know but you should be able to do it.Let me know if it's beyond you.

Technical??????

Elementary maths.

There is nothig tecnical about fund raising from shareholders my friend!

Try to give me each stores' NETT profit as a base and we can move on from there


Untill you can arrive at the point, you are Sir, I regret to say, a spanner in the works.

OK give me the gross margin per store and we can move forwards towards your goal.If it is elementary what is your figure for net margin / store and how did you get to it ?

Proteus that is the whole point, we simply dont have an individual store to store breakdown in order to asess these figures.

If you have the total net margin you can divide it by the number of stores.You're the one saying it's overvalued so unless you're making it up you must have some figures to base it on.So what's your total gross margin going forward.

What I would like please, and this should be available from COH, is a store to store breakdown of nett profit, I wont move untill I have that.

Why do you need that by store.Let me help again with the technical part that you find too taxing.Work out the total margin and then divide by the number of stores.See it's not that hard.

proteus

He is advocating a "thinking day" over on MLR...LOLOLOLOLOL.

Nope its not, but cant you see what I am after?

All you "am after" is wrecking this BB.