Greggs has sunk to a £13.7million pre-tax loss due to the Covid-19 pandemic - its first loss in 36 years, the company today revealed.
The bakery chain, which permanently closed 56 outlets last year and opened 84 new branches, thanked employees as it warned the next 12 months would be its toughest yet.
Bosses at the chain announced a pre-tax loss of £13.7million in 2020, compared with a £108.3million profit a year earlier, with sales dropping from £1.17billion to £811.3million as stores closed their doors for large swathes of the year.
But the company said it remains positive for the future and has committed to opening 100 new stores this year.
Delivery services and a partnership with Just Eat helped offset some of the falls, the company said, with 9.6% of total sales in the first ten weeks of 2021 now coming via deliveries.
But the latest lockdowns and restrictions since the start of the year have hit overall sales, the company said, with like-for-like sales down 28.8% in the ten weeks to March 13.
Stores have remained open for takeaways, as they are classed as essential retailers, however city centre locations and travel hub sites have seen substantial falls due to the stay-at-home Government orders.
Excluding sales in Scotland, where stores have been closed to walk-in customers for the majority of the year, like-for-like sales were down 22.4% during the period.
The company said the results for 2020 were slightly better than expected, considering the lockdowns, adding that it benefited from the furlough scheme and business rates holiday.
Bosses added they have access to a new £100million revolving credit facility to fund further expansion beyond the 2,078 stores in operation.
All staff in unopened stores remain on furlough.
Greggs listed on the London Stock Exchange in 1984 and had never previously reported a loss since becoming a public company.
Roger Whiteside Greggs chief executive, said: "Greggs has made a better-than-expected start to 2021 given the extent of lockdown conditions and is well placed to participate in the recovery from the pandemic.
"It has a clear strategy to extend its digital capabilities and to grow further in new locations, channels and dayparts. These opportunities will benefit all of its stakeholders in the years to come.
"In a year like no other I believe that the Covid crisis has in many ways demonstrated the strength of Greggs.
"It has shown the resilience of our business model, but most of all the strength of our people who have worked hard throughout to maintain an essential service providing takeaway food to customers unable to work from home, many of whom were themselves key workers.
"I would like to take this opportunity to thank all of our people, who can be proud of the part we played in our nation's time of need."
Drive-thrus
Greggs said it also aims to open between eight and 10 drive-thrus each year, although Whiteside admitted opening them is harder because of the unique specifications needed for each site.
The firm told The Mirror these outlets will be in car access locations such as retail parks and petrol forecourts.
The majority of its 100 new stores stores will be in areas where Greggs is under-represented and could also include locations that would have previously been too expensive as working patterns shift, leading to rents falling.
"Transport hub rents are already falling so we're seeing opportunities arriving in those locations for us to enter," Whiteside told the PA news agency.
"What's really interesting about delivery for us is that allows us to compete in the evening.
"But that means you need more hot food choices.
"So one of the things that we've been experimenting with is how we offer more in the evening.
"The best example we've got is our pizza slices.
"We probably sell more pizza slices than anybody else in the UK, because other people other people sell whole pizzas and we sell slices of pizza."
He added that during the Covid-19 pandemic, the company reverted to only offering best-selling lines, but innovation will return, following on from successful launches of its vegan steak bakes and doughnuts.
The chief said: "We see the move towards plant based alternative food as being a long term trend that is here to stay and therefore there will be more vegan versions of best-selling lines that we launched through the course of this year."
Coffee sales are also expected to grow, with more vegan milk alternatives set to be launched in stores later this year.
