Greggs has told investors that profits will beat expectations, as it continues to reap rewards from a revamped menu of hot drinks and sandwiches.
The bakery chain, which has 1,650 outlets, reported that in-store sales grew by 4.5% in 2014, accelerating to 6% in the final quarter of the year.
The company, which is best known for its sausage rolls and pies, told the City that full-year results for 2014 would exceed expectations. Roger Whiteside, Greggs chief executive, said: “This has been a year in which we have made good progress with our strategic plans and seen a welcome improvement in financial performance. We remain clear on our priorities and are confident that we can make further progress in the year ahead.”
Shares in the bakery chain were up nearly 6% to 793 pence.
After a period of disappointing sales in 2013, Greggs introduced a range of freshly made sandwiches with fewer than 400 calories, and less salt and sugar in a bid to compete with Pret a Manger-style chains. It has also changed its coffee blend in the hope of tempting customers with a “smoother” taste and launched breakfast meal deals. The company said new products, including soups and steak and cheese rolls had been well received.
The chain has also benefitted from fairly mild weather, unlike 2013 when a record-breaking freeze deterred customers from visiting its stores.
In 2014, Greggs opened 50 new shops, although it closed 71, reducing its overall store count. More than 200 shops were refurbished.
Whiteside said the first six months of 2015 looked favourable. Barring “a weather shock”, Greggs was likely to benefit from consumers’ rising disposable incomes, he said.
“People are finding more money in their pocket at the end of the month and that has to be helpful to us.”
