Greggs returns to first half profit
Greggs has returned to first half profit after the company benefited from the easing of Covid-19 restrictions in the period.
In the six months to 3 July, Greggs posted a pre-tax profit of £55.5 million compared to a loss of £65.2 million in the same period a year ago.
Meanwhile, total sales climbed to £546.2 million from a previous £300.6 million after sales in the second quarter exceeded expectations. 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 due to Covid-19 restrictions being lifted. The company said walk-in customer transactions were still below the level seen in 2019, but were compensated for by higher average transaction values and increases in delivery sales.
During the period, Greggs opened 48 new shops to take the total to 2,115 by 3 July. In addition, its new delivery service was made available from 837 shops. The company said shops in public transport hubs and large city centres continue to lag the overall group recovery rate as customers stay closer to home throughout the pandemic and use shops in suburban and high street areas.
Roger Whiteside, chief executive of Greggs, said: “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 more 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.
Whiteside added: “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 multichannel food-on-the-go brand. As a result, we now expect full year profit to be slightly ahead of our previous expectation.”
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