Krispy Kreme falls to $16m loss in Q3 as UK market underperforms

Krispy Kreme has seen losses widen to $16m (£12.9m) in its third quarter, up from a loss of $2.1m ( £1.7m) the prior year, as the UK market underperformed over the period.

In the quarter ended 29 September 2024, net revenues fell by 6.8% to $379.9m (£305.9m), down from $407.4m (£328.2m) the prior year.

Despite this, organic sales rose by 3.5% to $376.4m (£303.0m) over the period, in part driven by increased Delivered Fresh Daily and digital sales. Delivered Fresh Daily sales and digital sales both grew 15%, “more than offsetting” consumer “softness” in the US and UK.

In the International segment, net revenues grew $4.6m (£3.7m), or 3.7%, with organic revenue growth of $5.3m (£4.3m) or 4.2%, driven by Canada, Japan, and Australia, which “more than offset” underperformance in the U.K.

Adjusted EBITDA was $34.7m (£27.9m), marking a decline of 20.7% which was largely driven by the sale of a majority ownership stake in Insomnia Cookies.

CEO Josh Charlesworth said: “Krispy Kreme delivered a seventeenth consecutive quarter of year-over-year organic sales growth driven by increased Delivered Fresh Daily and digital sales.

“Now well into my first year as CEO, we have streamlined and focused our business with the sale of our majority stake in Insomnia Cookies complete and the acceleration of our US DFD expansion underway.”

He added: “To better align our talent and our capital to our business priorities, we are now restructuring our management teams to concentrate on maximising our profitable expansion of the U.S. while focusing international efforts on the wider adoption of our capital-light franchise model.

“With our resources prioritised to the things that matter most, I believe that these changes will result in a bigger and better Krispy Kreme.”