Patisserie Valerie has suspended its shares following the discovery of a £20million black hole in its accounts and also suspended its finance chief.
The cake shop and continental tea room, which has 155 stores in the UK, revealed its financial crisis before the London Stock Exchange opened today and asked CFO Chris Marsh to stay away from work.
Owners Patisserie Holdings said it has been notified of ‘significant, and potentially fraudulent, accounting irregularities and therefore a potential material mis-statement of the company’s accounts’.
As a result, this has significantly affected the company’s cash position and may lead to a ‘material change’ in its overall financial position.
Patisserie has therefore asked that its shares be suspended from trading on the London Stock Exchange’s junior AIM market while it carries out a full investigation into its true financial position.
Chairman Luke Johnson 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.’
Mr Johnson is Patisserie Holdings’ largest shareholder with a 37 per cent stake.
In May, the firm reported a 14.2 per cent rise in pre-tax profit for the six months ended March 31, up from £9.7 million to £11.1 million.
Revenue climbed 9.1 per cent to £60.5 million, it said at the time.
Patisserie Valerie trades from more than 200 stores and also has a partnership with Sainsbury’s, with branded counters present in the supermarket.