Caffe Nero thrives on daily cuppas

CAFFE Nero today toasted 'very strong' trading in the past six months and saw no signs of the consumer confidence slowdown plaguing other parts of the High Street. The Italian-themed chain said profits would materially beat City expectations while sales would be at the top end of forecasts. The group's second upgrade of its financial predictions in four months soothed nerves that had been set jangling by last month's downbeat trading news from Costa Coffee owner Whitbread.

Caffe Nero finance director Ben Price said: 'People may have stopped buying electrical goods or expensive clothes but not their daily cup of coffee.'

A price rise in November helped keep like-for-like sales 8.5% above a year ago. Recent store openings have gone well and the company now has 215 outlets.

House broker Collins Stewart upped its profit target from £4.3m to £4.9m. Since the start of the financial year, it has increased its forecasts by more than 40%. Nero shares jumped 15p to 204½p, adding £10m to its stock market value.