Greggs reports jump in profits
Greggs has reported an almost 50% increase in pre-tax profits in the first half of its financial year as the bakery chain benefited from new sales initiatives such as an improved sandwich range and new coffee blend.
Pre-tax profit excluding exceptional items rose to £16.9 million in the 26 weeks to 28 June from £11.4 million in the same period a year earlier.
While own shop like-for-like sales climbed by 3.2%, total sales increased by 3.1% to £373 million.
In addition to improvements in its product offer, Greggs also benefited from changes made to service levels including improved availability, extended trading hours and the launch of the new customer loyalty scheme, Greggs Rewards.
During the period, Greggs completed 131 shop refurbishments in line with its plan to refit around 200 shops in 2014. It also opened 26 new shops, including 14 franchise units, and closed 36 to give a total of 1,661 shops at the end of the first half.
The company said sales growth in July had continued to be strong although there had not been the widespread heatwave conditions that depressed sales last year.
Greggs chief executive Roger Whiteside said: "Whilst our year-on-year performance has benefited from comparison with a period of weak trading in 2013, sales growth is also being driven by initiatives that have further improved our products, availability, service and value. Our new and improved coffee blend and sandwich range are great examples of this.
"Although sales comparables strengthen in the second half the risk of input cost inflation appears to be reducing. Overall, we expect to deliver an improved financial result for the year and further progress against our strategic plan."
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