Cake Box Reports Strong Full-Year Results with 39.5% Revenue Growth and 37 New Store Openings

System sales – the total sales made by franchised and corporate stores to end customers – rose 27.7% to £111.27 million. That is a useful measure because it gives a feel for how the whole network is performing, not just the revenue Cake Box books itself.

The estate also kept growing at a healthy clip. The group opened 25 new Cake Box stores and 12 new Ambala stores, taking the total to 310. Ambala even beat the group’s target of 10 openings.

Cake Box online sales growth shows the digital strategy is working

There is more going on here than just opening shops. Online sales climbed 19.7% to £22.89 million, website orders were up 15.9%, and the business brought in 289k new online customers.

That tells you Cake Box is getting better at finding and keeping customers beyond footfall alone. It also helps that delivery platforms such as Deliveroo, Just Eat and Uber Eats are gaining traction.

The loyalty angle looks encouraging too. Cake Box Club reached 156k members by the end of the year, which should help repeat purchases and targeted marketing.

My read is simple: this is what you want to see from a modern franchise food retailer. Physical rollout plus digital growth tends to be a stronger mix than relying on one channel alone.

Ambala integration progress: encouraging, but not completely risk-free

Management says most of the integration work for Ambala is now complete. The focus has been on distribution, manufacturing, branding, packaging, store experience and digital upgrades.

That sounds sensible, and the initial numbers back it up. Ambala delivered £14.14 million of revenue and £1.85 million of underlying EBITDA in its first full year, compared with just £0.09 million of underlying EBITDA in 2025.

The upside case is clear. If Cake Box can franchise Ambala more aggressively and squeeze out efficiencies in supply chain and logistics, margins and returns could improve further.

But integrations are never a free lunch. They absorb management time, and they do not always go to plan. So far, though, the RNS reads like the process is moving in the right direction.

Profit quality, cash flow and debt: good overall, with a few watchpoints

Here is where the picture gets a bit more mixed, though still broadly positive.

Statutory profit before tax rose only 16.5% to £6.86 million, which is much slower than revenue growth. That gap is mainly down to higher finance costs and non-underlying charges.

Net finance cost jumped to £1.47 million from £0.29 million, largely because of debt taken on to fund the Ambala acquisition. That is not a shock, but it is the price of expansion.

Non-underlying items came in at £1.81 million, including a £1.65 million impairment of intangible assets linked to older ERP and website development projects. In plain English, Cake Box has decided some past tech spending is no longer worth what it once thought, partly because the enlarged group is moving to Shopify.

I would not call that disastrous, but it is not ideal either. It is a reminder that management has had to change tack on technology, and that comes with a bill.

Cash generation remained solid. Free cash flow before capital allocation items increased to £9.53 million from £7.07 million. However, capital expenditure rose to £5.94 million, including £2.57 million for the new Bradford warehouse, and dividends paid were £4.58 million.

That helped push net debt up to £10.84 million from £9.02 million. Even so, leverage was 0.88x underlying EBITDA, down from 1.03x and below management’s target of 1x.

That is an important reassurance. The debt is higher, but it still looks manageable based on the figures provided.

Cake Box dividend increase and shareholder returns look steady rather than flashy

The final dividend has been recommended at 7.2p per share, up from 6.8p. That takes the total dividend for the year to 10.8p, a 5.9% increase.

This is now the fifth consecutive year of dividend growth. It is not explosive, but it is steady, and the dividend cover improved to 1.48x from 1.29x based on underlying basic earnings per share.

That usually points to a payout that is getting a bit more comfortable rather than stretched.

Cake Box outlook for 2027: positive start, but consumer risks have not gone away

Management says trading in 2027 has started positively and ahead of 2026, with system sales running ahead of the prior year. The group is targeting a combined 35 new stores this year.

That sounds confident without getting carried away. The company is also still flagging the difficult consumer backdrop, inflationary pressure and wider macro uncertainty.

That caution is fair. Celebration cakes are hardly the first thing households cut, but they are not immune if consumer confidence weakens.

What Cake Box results mean for retail investors

This was a good set of results. The core business is still growing, Ambala is adding meaningfully, online momentum is strong, and debt remains under control.

The negatives are there too. Finance costs are up sharply, net debt is higher in absolute terms, and the tech-related impairment shows not every investment has gone smoothly.

Still, on balance, this feels like a positive update. Cake Box looks like a business expanding from a position of strength rather than scrambling for growth. For retail investors, that is usually the sort of distinction worth paying attention to.

One final footnote: the 2025 comparative figures were restated due to acquisition accounting corrections related to Ambala. That is worth knowing, but it does not change the broader message from this year’s results.