British baker and food-to-go retailer Greggs has reported a modest 2.5% growth in fourth-quarter like-for-like sales, as tight-pursed Christmas shoppers indulged in fewer Festive Bakes, sausage rolls, and gingerbread lattes.
The result for the quarter ended December, below an earlier expectation of a more than 5% rise, highlights how weak economic outlook cast a gloom over holiday spending with even Greggs, which has been resilient through Britain's cost-of-living crisis, not impervious to shaky consumer confidence.
'Trading performance reflected a well-publicised more challenging market backdrop in the second half of 2024,' the company said.
Greggs, famous for its sausage rolls, steak bakes and vegan alternatives, saw annual sales top £2 billion (€2.4 billion) for the first time, though the 11.3% rise missed analysts' average estimates of 12.2%, according to LSEG data.
The more than 80-year-old company, which has more than 2,500 outlets in the UK, warned that higher employment costs will lead to further cost inflation in 2025, but backed its growth plan as it targets opening between 140 and 150 net new shops this year.
'Year Of Good Progress'
Roisin Currie, chief executive commented, “2024 was another year of good progress by Greggs, with a record number of new shops opened and the £2 billion (€2.4 billion) sales milestone surpassed. [...] We enter 2025 with a strong pipeline of new shop opportunities, and we continue to broaden our menu and enhance our digital capabilities, whilst also developing our supply chain capacity to deliver our growth strategy.
“Whilst lower consumer confidence continues to impact high street footfall and expenditure, our value-for-money offer and the quality of our freshly-prepared food and drink position us well to meet the headwinds we expect to see in the year ahead, and we remain confident in the significant long-term opportunity for growth.”
'We are clearly of the view that Greggs is a class act, strongly on the front foot and well positioned to deliver strong growth over the medium term,' Shore Capital said in an analyst note.
Additional reporting by ESM.
