COFFEE REPUBLIC - about to boil in 2006?

Important to remember that the 4 franchises opened so far fall into H2 this year. They are all existing store changes so they must have got between £70K and £200K per store for each franchise - lets say £100K per store.

Lets give the stores the avearage sales per annum that they had as coffee shops, £350K per store. halve that for H2 sales and say £175K sales per store. Deduct CFE's 7.5% clear royalties - £13K per store pure royalties in H2.

You are looking at £450K+ pure income in H2 from the four franchises open so far in H2. If these were loss making stores then in H2 they have reduced the H2 losses from last year by around £500K imo. They lost £500K last yeat H1 so are they in profit for H2 now? Perhaps not but I reckon the roll out in H2 of the franchises is reducing losses to negligible levels now or they will be by the end of H2. This could see CFE kick off 2007 with profitabiliy and very good profitability imo.

CR