TORONTO, ONTARIO--(Marketwire - Oct. 25, 2012) -
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SPOT COFFEE (CANADA) LTD. (TSX VENTURE:SPP) ("SPoT" or the "Company") is pleased to announce that its Board of Directors has approved a new five-year expansion plan to increase the total number of system-wide cafés, expand further the wholesale and retail distribution of SPoT's award-winning gourmet coffee and proprietary coffee blends, and increase the growth of other areas of expansion that include enhancing the Company's corporate catering program and the launch of new food and beverage items.
Over the next five years, details of the expansion plan released by the Company include:
- 90-110 new corporate cafés leveraging SPoT's existing geographic footprint in Ontario and New York State and continuing to expand into the Northeastern United States. Future states of planned expansion include Pennsylvania, Connecticut, Massachusetts, New Hampshire and Vermont. SPoT intends to open ten corporate cafés over the course of 2013, continuing to increase the rate of corporate café expansion to two cafés per month by the start of 2016.
- 60-75 new North American licensed cafés, including the current licensing program commencing in Florida. Future North American licensed cafés will be outside the geographic footprint of corporate cafés in Ontario and the Northeastern United States. The Company expects to open a minimum of six new licensed cafés in 2014 with increasing amounts of regional expansion to come each subsequent year.
- 20-30 new licensed cafés through the Company's International Master License for the Middle East, North Africa, United Kingdom and Ireland. The first location is expected to open in 2014 with an increased number of units opening in each subsequent year. The Company has already identified key strategic regional and financial partners to assist with this execution and SPoT is currently establishing its International Master Licensor in the Republic of Ireland.
During 2013 SPoT will further roll out its corporate catering program to all new and existing corporate and licensed café locations. The catering program is expected to improve system-wide revenue throughout the five-year growth plan by increasing average café same-store-sales and cash flow generation on a year over year basis. Furthermore, the Company continues to see upside, through stronger demand caused by increased brand recognition, in the wholesale and retail distribution of the Company's award-winning gourmet roasted coffee and proprietary coffee blends. The Company has invested into increasing its existing roastery operation located in Buffalo, New York and will continue to invest in new roastery operations in line with the Company's growth. Outside of the Company's cafés, SPoT's coffee is currently sold retail through a regional grocery store chain in Western New York and wholesale through the Company's commercial account program to universities, businesses, convenience stores and institutions. SPoT is investing into personnel and infrastructure to support further expansion of these growth areas.
"I am extremely pleased that the Board of Directors has approved our five-year plan to grow SPoT's system-wide cafés to between 170-215 additional cafés by 2017. 2013 is optimal for commencing this strategy as SPoT's portfolio of cafés continues to perform extremely well, shown by last quarter's system-wide sales revenue being up 29% over 2011 and a same-store- sales increase of 13.2% for seasoned cafés," said Anton Ayoub, President of SPoT Coffee. "We have spent the last two years ensuring that the corporate infrastructure and café operating systems are in place to provide a strong and stable platform to support this future growth. I am confident that our strong and experienced operating team at SPoT can successfully execute this growth plan which includes new corporate cafés, licensed cafés, an enhanced catering program and the increase in the wholesale and retail distribution of our award-winning gourmet roasted coffee and proprietary coffee blends."
About SPoT Coffee
SPoT Coffee trades on the TSX Venture Exchange under the symbol SPP. SPoT designs, builds and operates community oriented cafés that provide its customers with the highest quality service, signature made-to-order meals and the world's finest in-house roasted gourmet coffee. Each SPoT café is distinctively designed to meet the uniqueness of the local neighborhood, creating a warm and friendly gathering place for the community. SPoT's commercial business focuses on retail stores, business accounts and third party resellers such as universities and hospitals.
Forward Looking Statements
Except for statements of historical fact relating to the Company, certain information contained herein constitutes forward-looking statements. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Factors that would impact the Company's ability to execute its growth plan include, amongst others, availability of expansionary capital, potential inability to locate and secure new café sites in locations that we believe to be attractive, obstacles to hiring and training qualified operating personnel in the local market, delay or cancellation of new site development by developers and landlords, which may become increasingly common during periods of economic uncertainty or tight credit, difficulty managing construction and development costs of new cafés at affordable levels, particularly in competitive markets, difficulty negotiating leases with acceptable terms, any shortages of construction materials and labor or lack of availability of, or inability to obtain, adequate supplies of ingredients that meet our quality standards. Except as required by applicable securities requirements, the Company undertakes no obligation to update forward- looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of the release.