Greggs posts 7% sales boost after strong Christmas

17-Jan-2017 - Last updated on 18-Jan-2017 at 11:46 GMT

Greggs reported a 7% sales boost in its latest trading update

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High street baker Greggs reported its 13th consecutive quarter of like-for-like sales growth after a strong festive period, as full-year sales increased by 7% in its latest trading update.

Store like-for-like sales were up 6.4% in Greggs’s fourth quarter, it reported. Christmas sales were particularly strong, boosted by its Festive bakes and mince pies, it said. Like-for-like sales growth was up 4.1%, when the two-week festive period was excluded.

Like-for-like sales were up 5.2% in the 52 weeks to December 31, Greggs reported. The business was in a good position to tackle the industry obstacles – including increased costs – in 2017, Greggs’s chief executive Roger Whiteside said.

“We finished 2016 well, and anticipate that we will report full year results for 2016 slightly ahead of our previous expectations,” said Whiteside.

‘Significant investment’

“In the year ahead, whilst we will undoubtedly see a number of well-documented industry headwinds, we are confident we will continue to make progress with the implementation of our strategic plan, including significant investment in our capability to supply a growing shop estate.”

Greggs’s Balanced Choice range was popular among shoppers, as well as its hot food options, the company said. Its hot drinks range will be extended “soon”, to include Vanilla Lattes and Fairtrade Peppermint Tea and Green Tea.

A net 66 new stores were opened across the 52 weeks, including 145 new shops. Greggs has 157 franchised stores operated by its partners.

‘Bakery food-on-the-go’

Also, 208 Greggs stores were converted to “bakery food-on-the-go” stores. About 208 stores were expected to be converted this year, to cater for customers’ modern, food-on-the-go preferences.

As of December 31, Greggs had 1,764 stores trading.

Greggs said increased costs were expected to cause a “modest impact” on its margins in the short term. But, it was confident of making “further progress” in growth, and said it would continue to transform and develop its supply chain.

“Over the medium term we are confident of making further progress as we implement our plan to grow Greggs as a modern food-on-the-go brand,” Greggs said.

Meanwhile, Greggs opened a new 4,645m² distribution centre in November. The new Enfield site would improve efficiency and increase delivery capacity, it said.