There’s no stopping Greggs and its array of reasonably priced baked goods, sandwiches and other on-the-go foods.
Apart from the pandemic, Greggs’s sales growth has been consistently strong over the past decade, and the first half of 2024 was no exception.
Total first-half sales were 13.8% higher, driven by a combination of like-for-like same-store sales growth and the impact of 51 net new store openings.
Greggs shares were 3.80% higher at the time of writing.
The firm’s underlying pre-tax profit, excluding exceptional items, rose by 16.3% to £74.1 million. Underlying diluted earnings per share also showed a marked improvement, rising to 53.8p from 46.8p in the previous year.
“Greggs has showcased its strengths once more, as the UK’s favourite baker continues to deliver. A high bar’s been set over the past year or so, but results have beat expectations once again,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
“The value offering that Greggs is so well known for has been holding it in good stead of late, and it was good to see that continue over the half with like-for-like sales well ahead of the industry average.”
In today’s update, Greggs pointed to menu innovation as a force for good when it came to boosting like-for-like sales. The roll out of mango and strawberry iced drinks across 500 stores and pizza meal deals spearheaded same store growth.
Greggs’ commitment to shareholder returns was evident in its announced interim dividend of 19.0 pence per share, representing an 18.8% increase from the previous year.
Looking to future effencies across the business, Greggs is making significant investments in its supply chain to support future growth. The redevelopment of its Birmingham distribution centre and the extension of its Amesbury facility are on track for completion in the second half of 2024. These improvements will create logistics capacity for an additional 300 shops. Furthermore, the company has begun construction of a new frozen manufacturing and logistics site in Derby, expected to be operational by late 2026.