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By Paul Sandle
LONDON (Reuters) – Britain’s Greggs said strong demand for its Festive Bakes, Christmas lunch baguettes and salted caramel lattes delivered a better-than-expected 9.4% rise in fourth-quarter like-for-like sales, sending its shares to a five-month high.
The food-to-go retailer’s strong Christmas resulted in full-year sales rising 19.6% to 1.81 billion pounds ($2.28 billion), comfortably beating market expectations of a 18.1% rise.
Its shares jumped 10% to a high of 2,718 pence on Wednesday, topping Britain’s mid-cap index.
Greggs outperformed lacklustre demand on Britain’s high street at Christmas, with data from the British Retail Consortium on Tuesday showing retail spending in December up 1.7%, representing a fall in volumes after inflation is taken into account.
Chief Executive Roisin Currie said Greggs, which opened 220 new stores in 2023 taking its total to 2,473, was selling its value-focused bakes, sandwiches and drinks in more retail parks, stations and on the road, as well as on the high street.
“We’re bringing out new products to excite the customer but also some key favourites, like the Festive Bake and the festive hot drinks that we know our customers love,” she said.
Greggs is opening stores later in the day to win a slice of the dinner trade, she said, as well as offering home delivery from Just Eat and Uber Eats.
“We have 710 shops that you can get Uber Eats deliveries from and we have 1,340 shops that offer Just Eat,” she said, adding that she wanted to provide a delivery option for all customers living or working near a store.
Greggs has been hit by inflation in ingredients, energy and other costs, but Currie said the pressure was easing and she anticipated a more stable cost base in the coming year.
But wage inflation remained an issue, she said, and Greggs had just raised pay for store staff by 9.6% and for staff in the supply chain and wider business by 8%.
($1 = 0.7881 pounds)
(Reporting by Paul Sandle: Editing by William James and Sharon Singleton)
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