Shares in Cake Box (LON:CBOX) sweetened up after the fresh cream celebration cakes retailer delivered forecast-beating FY26 profits. The Enfield-based firm also raised the full-year dividend for the fifth year on the spin.
Despite the well-documented pressures facing the consumer, Cake Box said trading in FY27 has started positively and ahead of 2026, supported by continued momentum in system sales.
Tasty progress
Led by CEO Sukh Chamdal, Cake Box generated strong sales growth for the year to March 2026. This was supported by 37 new store openings and a maiden full-year contribution from Ambala, the Asian sweets maker and retailer gobbled up in March 2025.
Group revenue fattened up 39.5% to £59.7 million. Adjusted pre-tax profits grew 22.6% to £8.7 million, ahead of the £8.6 million house broker Shore Capital was calling for.
Encouragingly, the core Cake Box business put up a tasty performance, with revenue rising 9.3% despite well-versed UK consumer headwinds. This demonstrated the resilience of Cake Box’s franchise model.
Another highlight was a near-20% surge in online sales to £22.9 million, aided by a 15.9% increase in website orders which helped Cake Box secure 289,000 new online customers. The AIM-listed company highlighted ‘strong growth’ through delivery platforms Deliveroo, Just Eat and Uber Eats.
Healthy pipeline
Chamdal said management is keeping ‘a close watch’ on the wider macroeconomic environment and consumer sentiment. ‘We have plans in place to mitigate any potential impact on the business,’ insisted Chamdal, ‘including managing our cost base and supply chain for efficiencies.’
He added: ‘Despite these challenges, we are well positioned to deliver further growth in the year ahead. Our healthy pipeline of new franchise locations, together with the effectiveness of our multi-channel sales strategy, gives us confidence in the fundamentals and resilience of our business to continue to grow.’
Cake Box would make a sweet addition to any UK small caps portfolio. The company’s capital light franchise growth model drives robust cash generation and supports a progressive dividend.
Furthermore, Cake Box is generating strong organic growth in the core business. And the strong franchisee interest it is seeing augurs well for future growth.
Product innovation remains a key driver of customer engagement and revenue growth. Cake Box continues to develop seasonal and celebration-led ranges across key celebration occasions such as Mother’s Day, Valentine’s Day, Easter, Eid, and Diwali. This allows it to cash in on demand across diverse communities and peak trading periods.
Shore Capital argues: ‘Capital light Cake Box trades on multiples that in our view are too low for a double-digit growth, cash generative high yielding investment opportunity.’
Read the press release here: https://cakeboxinvestors.com/
