A rebound in sales since the easing of Covid restrictions has helped Greggs return to profit as it continues with its ambitious store opening programme.
Over the six months to 3 July, the bakery chain saw its total sales climb from £300.6m to £546.2m – in line with its pre-pandemic figure in 2019.
On a like-for-like basis, first-quarter sales were down 21.5% on 2019 levels but rose by 2.8% in the second quarter as high streets reopened and consumers ventured out more. The company revealed that walk-in customer transactions were still below the level seen prior to the pandemic but were compensated for by higher average transaction values and increases in delivery sales.
The improving sales trend helped Greggs post a pre-tax profit of £55.5m compared to a heavy loss of £65.2m in the same period a year ago.
During the period, Greggs opened 48 new shops and closed 11 to take the total to 2,115. The group stated that it was on track for around 100 net shop openings in 2021, with 500 new jobs to be created in the second half.
The business pointed to even more ambitious growth plans, saying it has “the opportunity to expand its UK estate to at least 3,000 shops”. Most of its most recent openings have focused on car-accessed locations such as roadsides, petrol stations, retail parks and supermarkets.
The company’s delivery service has also now been rolled out to 837 shops, with the channel representing 8.5% of its company-managed shop sales in the first half.
Greggs highlighted that outlets in public transport hubs and large city centres continue to lag the overall group recovery rate as some customers continue to stay closer to home and use shops in suburban and local high street areas.
Chief Executive Roger Whiteside commented: “Greggs once again showed its resilience in a challenging first half, emerging from the lockdown months in a strong position and rebuilding sales as social restrictions were progressively relaxed.
“We continue to make good progress with our strategic priorities, growing the shop estate and investing in our digital capabilities to compete in all channels and dayparts of our market.”
Giving an update on recent trading, Greggs said like-for-like sales in company-managed shops in the four weeks to 31 July were up 0.4% on the equivalent period in 2019.
The company concluded: “Despite the general uncertainties in the market, Greggs has traded well in recent months and demonstrated the resilience of its business model as well as its potential for longer-term growth as a multi-channel food-on-the-go brand. As a result, we now expect full-year profit to be slightly ahead of our previous expectation.”
