Greggs posts 17th quarter of continued sales growth
Fourth quarter LFL sales for the company were up 3%, while company-managed shop LFL sales grew 3.7% for the year ending December 30 2017. Total sales for the year were up 7.4%.
Greggs attributed growth to its festive and seasonal products, including its Festive Bake and fresh-baked mince pies. Its hot sandwiches and gluten-free Balanced Choice soup had also proved popular.
Chief executive Roger Whiteside commented: “In the year ahead, we will continue to focus on delivering the outstanding value and taste that Greggs is famous for.
‘Record year for investment’
“This year will be a record year for investment in our supply chain and we intend to increase the rate of new shop openings as we continue to grow Greggs as a leading food-on-the-go brand.”
The end of 2017 saw Greggs invest into new systems for its supply chain operations, including commissioning a new national manufacturing facility for the production of small cakes and muffins at its Leeds site.
In its outlook for 2018, Greggs said: “[This year] will be a record year for investment in our supply chain as we install many of the centralised manufacturing platforms that will provide the capacity for further growth of the business.”
The baker opened 131 new shops last year and closed 41, with 1,854 stores open across the country.
It also saw success in the food-to-go market, refurbishing 132 stores into ‘bakery-on-the-go’ shops, with plans to open 100 more of the stores in 2018.
Industry-wide cost pressure
The company expected industry-wide cost pressure to continue in the year ahead, but at a lower level than it had experienced in 2017.
Commenting on Greggs’s results, Darren Shirley of market analyst Shore Capital said the company had delivered a solid trading update against demanding comparatives and with tougher December trading conditions.
“After a very strong 12 months, during which the share price has appreciated over 30% despite financial expectations remaining unchanged, we believe Greggs’s stock is fully valued and reiterate our hold stance,” said Shirley.
Meanwhile, Premier Foods has posted continued sales growth in its third-quarter trading statement, boosted by its partnerships with Nissin Foods Group and Mondelēz International.
