Partly Cloudy

Partly Cloudy

max temp: 6°C

min temp: 2°C

ESTD 1874 Search

Retail: Greggs on track to serve up improved first half profits

10:03 01 July 2014

Greggs today reported strong first-half sales.

Greggs today reported strong first-half sales.

Greggs is set to report a big jump in half-year profits after sales at the pasty and sausage roll maker rallied on the back of recent turnaround efforts.

shares

The bakery chain, which has 1,661 shops in the UK, grew like-for-like revenues by 3.2% in the 26 weeks to June 28. Operating profits due later this month are now on course to be around £16million to £17m, up from £11.5m last year.

The improvement follows a move by chief executive Roger Whiteside to increase the focus of the business on the food-on-the-go market, which accounts for 75% of customer visits, rather than traditional take-home business.

The company has previously admitted it underperformed the food-on-the-go sector as convenience stores, coffee shops and fast food operators better met customer demands, particularly in traditional shopping centre locations.

Greggs has responded by completing 131 shop refurbishments in the first half of the year, in line with its plan to refit around 200 shops this year.

It also opened 26 new shops and closed 36 in a drive to target more sites in locations such as retail and industrial parks and motorway service stations.

Greggs has benefited from comparisons with a period of soft trading last year but adds that growth is also being driven by improvements to its products, availability, service and value.

The company added: “Overall, we expect to deliver an improved financial result for the year and further progress against our strategic plan.”

It has introduced a new pizza product that has become one of its fastest selling lines, as well as a range of ‘heat to eat’ sandwiches. In savouries it has improved the fillings in its best-selling lines such as Steak Bakes.

Cost inflation has also shown signs of easing recently but Greggs has warned that the costs of investing in its turnaround programme is likely to constrain profit growth over the next two years.

Shore Capital analyst Darren Shirley said: “Comparatives for the period were weak and the weather conditions have been almost perfect for Greggs, so we are not getting carried away.

“However, stores have clearly benefited from improved availability, longer trading hours as well as product upgrades.

“We believe Roger Whiteside merits much credit for progressively returning Greggs’ stores to like-for-like growth over the course of his 15 months’ tenure.”

shares

1 comment

  • Given how horrendously salty their food is, this can only mean good news for cardiac surgeon employment. Last time I had a Gregg's pasty there was so much salt in it I could almost feel my blood pressure going through the roof.

    Report this comment

    beerlover

    Tuesday, July 1, 2014

The views expressed in the above comments do not necessarily reflect the views of this site

James Cooper, centre, of Survey Solutions, with Robertt Mullins, left, and  Jeff Bate of East Anglian Land Surveys.
Photo: Paul Nixon

East Anglia’s largest independent firm of surveyors has consolidated its position with the purchase of another Suffolk-based business.

Morrisons in Stowmarket.

The Morrisons supermarket in Stowmarket will close on April 3, it has been announced.

PCA England masters players, from left,  Paul Nixon, Matthew Hoggard, Mark Ramprakash and Alistair Brown at Lord’s celebrating Greene King's new partnership with the association.
Photo: portraitcollective.com/Sam Bowle

Greene King has agreed another major cricket sponsorship deal, this time in support of the game at grassroots level.

The BT apprenticeship showcase evening

More than 200 students, parents and teachers gathered at BT Adastral Park in Martlesham for the company’s apprenticeship showcase on Wednesday.

Alastair Kerr and Philip Turner. Mr Turner's firm, the Chestnut Groupr,  is to take on the management of the White Horse Inn at Easton, near Framlingham.

A picturesque village pub is set to be relaunched under new management in May.

Most read

Fred Olsen Travel Sale

cover

Click here to view
the Fred Olsen
Travel Sale

View

Most commented

HOT JOBS

Show Job Lists

Topic pages

Streetlife

Great British Life

Great British Life
MyDate24 MyPhotos24