Thorntons witnesses a sharp drop in profits.

British chocolate retailer Thorntons has reported a 39% fall in half-year profits as tough economic conditions has forced the company to slash prices.

Thorntons made a profit before tax of £7.3 million in the 28 weeks to the 10 January 2009, down 39% from £11.9m in 2008. The company’s total revenues have risen by 1.3% to £128.4m.

The chocolate store blames the drop in profits on deteriorating high street conditions.

Mike Davies, Chief Executive of Thorntons, commented: “Profit was adversely affected by increased promotional activity in response to rapid market decline during the second quarter.”

Although Thorntons did not give an exact figure, like-for-like sales also suffered – particularly hit by the high level of discounting retailers undertook to compete within the weakening market.

The company remains optimistic with a positive outlook for the future: “With prudent cost management, product innovation and keeping customers at the forefront of our thinking, I am confident that we will emerge from the current conditions a stronger, more profitable business.”

Franchise sales increased by 3.7% to £9.9m in the half year.

Thorntons was founded in 1911 and has 379 stores and approximately 250 franchised outlets across the UK.