Starbucks: UK’s largest franchise more than doubles profit ahead of takeover
Sales jumped towards £100m and profit more than doubled at the UK’s largest Starbucks franchise in the year before the US coffee chain took it over, it has been revealed.
23.5 Degrees has reported a turnover of £93m for the 12 months to 31 August, 2024, up from the £83.5m it achieved in the prior period.
New accounts filed with Companies House also show that its pre-tax profit surged from £1.6m to £4.1m over the year.
The results come after Starbucks acquired 23.5 Degrees in October 2024.
23.5 Degrees was the first and largest Starbucks franchise in the UK after launching in 2013.
At the time, Starbucks UK general manager Alex Rayner said: “I want to acknowledge the important contributions of 23.5 Degrees and the dedicated green apron partners.
“This strategic move will enable us to enhance our investment in new locations, elevate our in-store experience, and drive innovation for our UK customers.”
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A statement signed off by 23.5 Degrees’ board said: “Whilst there has been localised disruption within the store estate due to false perception of brand association with Middle East conflict, underlying trading remained strong.
“Inflationary pressures seen in 2023 eased since the start of the new fiscal year and the group has benefitted from a rebalancing in commodity prices and the benefit from a lower rate electricity contract from November 2023 at half the cost per kWh previously paid.
“Overall the business performed strongly by sticking to its operating model by putting its partners and customers at the front of [the] decision-making process.
“This has been developed and honed over the last decade and as a result continues to deliver industry-leading transaction growth and partner loyalty.”
In the year the average number of people employed by the business increased from 1,729 to 1,871.
Earlier this month, accounts filed with Companies House revealed that Starbucks slumped to a pre-tax loss of £35.2m in the 12 months to 29 September, 2024.
The loss came after the chain posted a pre-tax profit of £16.8m in the prior year.
The results also showed that its turnover declined from £547.6m to £525.6m over the same period.