High street cake chain warns of ‘potentially fraudulent’ accounting
Upmarket cake and café chain Patisserie Valerie has suspended its chief financial officer and halted trading of its shares on AIM following the discovery of ‘significant, potentially fraudulent, accounting irregularities’
10 Oct 2018
In a regulatory statement, parent company Patisserie Holdings said: ‘During the course of 9 October 2018, the board of directors of the company has been notified of significant, and potentially fraudulent, accounting irregularities and therefore a potential material mis-statement of the company's accounts.
‘This has significantly impacted the company's cash position and may lead to a material change in its overall financial position.’
CFO Chris Marsh has been suspended from his role, and the company said it was now conducting ‘a full investigation with its legal and professional advisers into its true financial position’.
Luke Johnson, Patisserie Holdings chairman, said: ‘We are all deeply concerned about this news and the potential impact on the business. We are determined to understand the full details of what has happened and will communicate these to investors and stakeholders as soon as possible.’
Entrepreneur business investor Johnson owns a 37% stake in the businesses, which also includes Druckers, Philpotts, Baker & Spice and the Flour Power City Bakery.
In its six-monthly trading update was in May, Patisserie Holdings said its half-year profits were 14.2% higher at £11.1m. It noted at the time that its largest brand, Patisserie Valerie, was up £5.4m or 13.2% to £45.8m (2017: £40.4m).
The company’s auditor is Grant Thornton.
The first Patisserie Valerie store was opened in the Soho district of London in 1926 by a Belgian woman, Madame Valerie. It now has more than 150 stores around the UK and also trades in the supermarket chain Sainsbury's.
Report by Pat Sweet