After posting its first annual loss since it floated in 1984, food-to-go chain Greggs stated that it was targeting a “rapid return” to its previous levels of growth with more shop openings planned for this year.
With its high street stores impacted by the coronavirus lockdown measures, the group’s total sales plummeted 30.5% to £811.3m over the year to 2 January. And it reported a £13.7m pre-tax loss, down from a profit of £108.3m in 2019.
Like-for-like sales at company-managed shops fell 36.2% as footfall in city centres and travel hub sites fell dramatically. This could have been worse had Greggs not ramped up its delivery services and activities in the wholesale channel.
After 56 closures, the group opened a net 28 stores last year, taking the total count to 2,078. Greggs is now planning around 100 net new shops for 2021 with it hoping to take advantage of empty sites coming on to the market following the struggles of the retail sector during the pandemic.
The company also said today that it plans to relocate some stores to bigger sites with more seating and was increasing its overall growth target for its estate from 2,500 shops to 3,000.
Chief Executive Roger Whiteside said that Greggs had “made a better-than-expected start to 2021”.
He added that the chain was “well placed to participate in the recovery from the pandemic”.
NAM Implications:
- For context, the loss was 1.7% vs a profit of 9.3% in 2019…
- …near breakeven but still serious.
- Clearly, Greggs are prepared to put money on growing its estate from 2,500 shops to 3,000.
- Are you?
