Greggs cautious on outlook after weather dents sales
Greggs has reported that its total sales have risen by 4.7% in the first 18 weeks of 2018 but said its full year underlying profit is expected to be at a similar level to last year.
Meanwhile, like-for-like sales at its company managed shops increased by 1.3% in the period following an uplift of 3.2% in the first eight weeks of the year as trading in March and April was impacted by weaker market conditions.
In a statement ahead of its AGM today, the company said weak customer footfall in retail locations, particularly in the weeks of wintry weather, had dented demand for its food-on-the-go offering.
Greggs said its £2 breakfast offer is proving particularly popular and that sales of healthier options, such as salads and snack pots, are continuing to grow.
During the period, Greggs completed 36 shop refurbishments and opened 41 new shops, including 14 franchised units in transport locations. It also closed 12 shops which meant there was a total of 1,883 shops trading at 5 May.
New shop openings are being focused on extending the brand’s reach into new food-on-the-go locations with store openings in places such as Westminster Tube station, Birmingham New Street station, Glasgow Buchanan bus terminal and East Midlands airport.
Greggs said it is making good progress with its new supply sites as its looks to consolidate manufacturing operations and extend its distribution capacity to support further growth in shop numbers.
Looking ahead the company said: “Sales in May have started more strongly than we experienced throughout March and April, however given the uncertainties over market footfall we are cautious in respect of the outlook for sales in the balance of the year.
“Taking into account trading conditions in the year to date, and our more cautious outlook, we currently believe that underlying profits for the year are likely to be at a similar level to last year.”
