Sales at Greggs rise on demand for Health options
LONDON (Reuters) – British baker Greggs reported a rise in sales over its third quarter on Tuesday, helped by robust demand for new healthier products and its breakfast offer, and keeping it on track to meet its full-year expectations.
The Newcastle, northern England, based firm sells sandwiches, sausage rolls and pastries from 1,743 retail outlets in the UK and sees scope for substantially more than 2,000.
Greggs is two years into a five-year plan to convert the company from a traditional bakery business to focus on Britain’s more than 6-billion-pounds a year market for food-on-the-go.
It said sales at company managed stores open over a year rose 2.8 percent in the 13 weeks to Oct. 1, its fiscal third quarter, while total sales increased 5.6 percent.
“The popularity of our summer menu including an extended range of ‘Balanced Choice’ salads and yoghurts supported sales growth in the period,” said the firm.
“We also saw continued strong growth at breakfast time, helped by our strong coffee offer and value deals.”
Greggs has now launched its autumn/winter menu which includes new lower-calorie bakes and soups along with a range of new snacks with gluten-free options.
So far this year Greggs has refurbished 145 shops and is on track to refurbish around 200 over the full year. It has opened a net 45 stores, with a net of about 70 planned for the year.
“Our expectations for the full year outturn remain unchanged,” said the firm.
“As we look to next year, whilst we anticipate some general industry-wide cost pressures, we expect to make further progress against our strategic plan.”
Prior to Tuesday’s update, analysts were on average forecasting an underlying pretax profit of 78 million pounds for 2016, according to Reuters data, up from 73 million pounds in 2015.
Shares in Greggs closed Monday at 10.46 pounds, valuing the business at 1.07 billion pounds.
(Reporting by James Davey, Editing by Paul Sandle)