REG - Greggs PLC - Preliminary Results
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RNS Number : 0166V Greggs PLC 03 March 2026
3 March 2026
GREGGS PLC
("Greggs" or the "Company")
PRELIMINARY RESULTS FOR THE 52 WEEKS ENDED 27 DECEMBER 2025
Resilient performance in a challenging market
2025 Financial highlights
2025 2024 % change
Total sales £2,151m £2,014m +6.8%
Underlying operating profit * £187.5m £195.3m -4.0%
Underlying profit before tax * £171.9m £189.8m -9.4%
Statutory profit before tax £167.4m £203.9m -17.9%
Underlying diluted earnings per share * 122.8p 137.5p -10.7%
Diluted earnings per share 119.3p 149.6p -20.3%
Diluted operating cash inflow per share 267.1p 255.4p +4.6%
Total ordinary dividend per share 69.0p 69.0p -
* 2025 excludes the exceptional impact of a £4.5 million provision for a
historic understatement of VAT self-identified and reported to HMRC in the
year. 2024 comparative excludes the impact of £14.1 million exceptional gain
primarily related to the sale of a legacy supply site
· Total sales** up 6.8% on 2024, with LFL*** sales in company-managed shops up
2.4% year-on-year
· Underlying* operating profit**** 4.0% lower at £187.5 million (2024: £195.3
million)
· Underlying* profit before tax 9.4% lower at £171.9 million (2024: £189.8
million)
· Underlying* diluted earnings per share 10.7% lower at 122.8p (2024: 137.5p)
· Diluted operating cash inflow per share up +4.6% representing strong
underlying cash generation
· Net cash position of £45.8 million reflecting the level of capital investment
in supply chain capacity
· Final dividend of 50.0p per share recommended, total ordinary dividend per
share of 69.0p per share, maintained at 2024 level
** 52 weeks ended 27 December 2025 (2024: 52 weeks ended 28 December
2024)
*** like-for-like sales in company-managed shops (excluding franchises)
with more than one calendar year's trading history
**** profit before net finance charges and income tax
Operational and strategic progress
Fastest-growing brand in the food-to-go market:
· Greggs share of visits up 0.5 percentage points to 8.6% for the year to
December 2025 (source: Circana). Greggs now a top four brand in all dayparts
and in delivery
· Brand health metrics remain strong; Greggs continues to be the UK's leading
food-to-go (FTG) brand (YouGov's Brand Index, December 2025)
Value leadership - quality and price-driven:
· Greggs remains the number one FTG brand for value
· Greggs Rewards App provides access to even greater value for loyal customers,
increasing frequency of visit
· Value driven by quality as well as price - Greggs differentiates with freshly
prepared food, hot options and customisation
Increasing access to Greggs:
· Shop growth - clear opportunity for significantly more than 3,000 UK shops
over longer term
‒ 121 net openings in 2025, growing the estate to 2,739 shops as at 27
December 2025
‒ Targeting around 120 net openings in 2026 with a strong pipeline of
attractive opportunities
‒ Trialling new 'bitesize Greggs' format to meet incremental customer
demand in locations requiring a more compact unit
· Delivery - delivery sales up 8.1% in 2025, representing 6.8% of
company-managed shop sales (2024: 6.7%), now number four in market for
delivery occasions (Circana)
· Loyalty - Greggs App scanned in 26.7% of company-managed shop transactions
(2024: 20.1%); customers who engage with the App shop at Greggs more
frequently
· Evening - remains fastest growing daypart; 9.4% of company-managed shop sales
in 2025 (2024: 9.0%), now number four in market for dinner visits (Circana)
· Grocery retailing - launched Bake-at-Home with Tesco and expanded range with
Iceland
· Menu - keeping the menu fresh and relevant by introducing new flavours and
products, most recently launched a great value iced matcha latte in February
2026 (priced from £3)
Managing costs and capital investments:
· Managing costs closely is strategically important as a value retailer,
structural cost savings of £13.0 million delivered in 2025 and strong plans
in place for future years
· New National Distribution Centres in Derby and Kettering increase logistics
capacity to 3,500 shops and remain on time and on budget
· Capital expenditure peaked in 2025 at £287.5 million and will fall to circa
£200 million in 2026, before reducing to a range of £150 to 170 million from
2027 on. The Company's strong operating cash generation will create material
capacity for additional cash returns
· Key focus is restoring the Company's return on capital employed to target of
around 20%
Current trading
· Like-for-like sales in company-managed shops increased by 1.6% year-on-year in
the first nine weeks of 2026, with total sales increasing 6.3% and strong cost
control supporting profit conversion
· Full year guidance unchanged - expect to deliver profits at a similar
underlying level to 2025, with any year-on-year improvement contingent on a
recovery in the consumer backdrop
Roisin Currie, Chief Executive commented:
"Greggs delivered a resilient performance in 2025, growing market share,
alongside continued strategic progress. Looking into 2026, easing inflationary
pressures should provide some support to consumer spending and demand for
convenient food-on-the-go continues to underpin the market. We remain focused
on broadening access to Greggs with a strong pipeline of shop openings,
exciting launches and deeper customer engagement via the Greggs App.
We have a clear formula for long-term success, leveraging our value
leadership, vertical integration, breadth of range and strong track record of
innovation. Together, these strengths give us a clear competitive advantage
and position us well to deliver further sustainable growth."
ENQUIRIES:
Greggs plc (http://www.greggs.co.uk) Hudson Sandler (http://www.hudsonsandler.com)
Roisin Currie, Chief Executive Wendy Baker / Hattie Dreyfus /
Richard Hutton, Chief Financial Officer Emily Brooker / India Laidlaw
David Watson, Head of IR Email: greggs@hudsonsandler.com
Tel: 0191 281 7721 Tel: 020 7796 4133
An audio webcast of the analysts' presentation will be available to download
later today at http://corporate.greggs.co.uk/ (http://corporate.greggs.co.uk/)
Chair's statement
Greggs outperformed a tough market in 2025 and delivered the continued
strategic progress that will support further growth in the years ahead,
demonstrating its resilience. Our success is down to the thousands of
amazing people who work in our business and the energy they demonstrate every
day. We continue to be excited by the many opportunities ahead and our
programme of investment to support that ambition is proceeding according to
plan.
Overview
Greggs benefits from a fantastic brand, strong market position and a track
record of innovating to adapt to changing customer needs. These unique
strengths helped us navigate a challenging food-to-go market in 2025,
increasing share and maintaining the competitiveness of our offer despite the
headwinds. The financial outcome reflected these market headwinds but has
been well-managed and has not distracted the team from the significant
opportunities that lie ahead as we continue to innovate and evolve our offer
in line with consumer preferences and leverage the benefits of our
vertically-integrated model. We also made good progress investing in the
systems and supply chain capacity that will help us to realise our ambition in
the years to come.
The Board's agenda for the year reflected this growth context, and the need to
manage risk in a competitive and challenging environment. Cyber security and
our plans to manage the business during a period of significant systems change
were both in focus, particularly given the well-publicised issues faced by
other retailers. Technological change continues to accelerate and the Board
received updates from management on the work being undertaken to increase the
organisation's capability in areas such as data analysis and the integration
of AI into our business processes.
As a food business, our processes for allergen management continued to be an
area of Board focus, given the material risk associated with this. Strong
progress has been made and the Board received updates on this work and the
further measures being taken to ensure that protection for our customers
continues to advance and remains at the centre of how we operate.
The Greggs Pledge is our way of articulating our approach to responsible
business. I'm incredibly proud of the progress that Greggs has made over the
past five years against its original five-year commitments. Quite apart from
being the right thing to do, this progress enhances our reputation with
customers, makes us a more attractive employer to our colleagues, and reduces
risk of reputational damage to the brand.
Our people and values
The Board works hard to stay close to our colleagues across the business in
order to listen to their feedback and ensure that we are aware of their ideas
and concerns. Our people offer their views freely and this openness,
characteristic of the culture of the business over so many years, is important
in making sure that Board members are cognisant of this in our deliberations.
The Board's 'listening' activity involves Directors visiting shops, supply
sites and support teams, as well as attendance at forums that help us to hear
the impact of our plans on colleagues. This helps the Board to question and
support management and makes us better equipped to make informed decisions.
The Board
The composition of the Board was unchanged during 2025. We planned
succession for Kate Ferry, who will retire from the Board on 6 March 2026 and
for Mohamed Elsarky, who steps down after the Annual General Meeting (AGM) in
May 2026. Both Kate and Mohamed have made an exceptional contribution to
Greggs. Richard Smothers joined the Board on 1 February 2026 and will assume
the role of Chair of the Audit Committee following Kate's retirement.
Richard brings extensive financial expertise in a listed company environment
and great experience in retail which will be of significant benefit to the
business.
Further details of the Board's work are included in the Governance and
Committee sections of the Annual Report and Accounts 2025.
Dividend
At the time of the interim results in July 2025 the Board declared an interim
ordinary dividend of 19.0 pence per share (2024: 19.0 pence per share). In
line with our ordinary dividend policy the Board intends to recommend at the
AGM a final dividend of 50.0 pence per share (2024: 50.0 pence per share),
giving a total ordinary dividend for the year of 69.0 pence per share (2024:
69.0 pence per share).
Our capital allocation policy, as outlined in the Financial Review, details
our approach to distribution, and the methodology for determining and
returning any surplus cash to shareholders.
Looking ahead
Despite the challenging market conditions, the underlying strengths of the
business remain clear, and the breadth of our appeal and value leadership have
allowed us to continue to outperform in a tough market. We expect consumer
sentiment to continue to be a headwind in 2026, but with a strong competitive
position and a clear opportunity for further growth Greggs can weather these
conditions and continue to outperform the market.
Our investment plans are progressing well and will provide the infrastructure
with which to realise the significant growth opportunity that lies ahead. At
the same time, the Greggs team continues to demonstrate its ability to
navigate the short-term challenges presented by the market. Our brand and
financial position remain strong and the Board remains confident in the
prospects for further profitable growth over the medium term.
Matt Davies
Chair
3 March 2026
Chief Executive's report
Our customers come back to Greggs again and again because we offer them a
delicious and exciting range of great value products. Once again, their
loyalty has helped us to outperform our competitors in challenging market
conditions, generating record sales as we continue to expand our range.
Outperforming in challenging conditions
We are pleased with the Greggs brand's resilience against the backdrop of a
tough environment for the whole food-to-go market in 2025. We increased our
share of food-to-go market visits by 0.5 percentage points to 8.6%, with gains
across all dayparts, in a market where visits shrank 3.1% (source: Circana, 12
months ended December 2025). Card spending data also confirmed that we
outperformed the wider eating & drinking out-of-home market in the year to
December 2025.
We are seeing some emerging shifts in dietary preferences, with certain
consumers seeking greater choice in areas such as increased protein, more
fibre and smaller portions. We expect this will be a developing trend and are
confident in our ability to evolve our range to appeal to those looking for
different nutritional profiles and portion sizes when eating out of home,
building on our track record of responding to change and entering new
categories with value-based options. Our analysis of the factors impacting
sales performance suggests that pressure on disposable incomes remains the key
factor. We remain confident that demand for convenient food-on-the-go as
customers go about their busy lives will continue to underpin the market.
In the year ahead we expect market conditions will remain challenging for the
consumer. We continue to stay focused on value and are significantly ahead of
our competitors on this metric. Greggs value proposition makes it relatively
resilient in the face of cyclical pressure on consumers, and we will continue
to focus on this through strong cost control and structural efficiency
opportunities. At the same time we are successfully increasing access to
Greggs through the extension of our own shop estate alongside partnerships
with grocery, franchise and delivery partners.
Financial results
Total sales grew to £2,151 million in 2025 (2024: £2,014 million), a 6.8%
increase on 2024. Within this, company-managed shop like-for-like sales were
2.4% higher than 2024 and like-for-like 'system sales' in franchised units
rose by 4.3%.
Underlying operating profit was 4% lower than in the previous year, due to
increased fixed costs in respect of manufacturing, logistics and technology
capacity and the operating leverage impact of lower like-for-like volumes.
Underlying pre-tax profit for the year decreased by 9.4% to £171.9 million
(2024: £189.8 million), with reduced interest income on cash deposits and a
higher lease interest charge as the estate grows and leases are renewed. For
further detail, see the Financial Review. Including exceptional items,
statutory profit before tax for the year decreased to £167.4 million (2024:
£203.9 million including an exceptional gain of £14.1 million primarily
related to the sale of a legacy bakery site).
Operational progress in 2025
The fastest-growing brand in the food-to-go market
Keeping the brand at the front of people's minds and giving them good reasons
to choose Greggs is a key focus, and in 2025 we once again topped the YouGov
Brand Index, ranking first for both value and consideration, proving that
consumers believe we are getting it right.
Market share data (source: Circana, 12 months ended December 2025) highlights
our success, with Greggs remaining the number 1 brand at breakfast, number 2
at lunch, number 3 for snacking and now number 4 for both the dinner market
and delivery channel. Greggs is an inclusive brand that appeals to a mix of
customers that broadly reflect the market as a whole.
Our investment in marketing to drive brand awareness and performance
continues, promoting our menu through out-of-home poster campaigns, radio
advertising, and paid social media. These have been bolstered by witty brand
activation campaigns, including the launch of our first home furnishings
collection, which included beanbags and cushions in the shape of Greggs
Sausage Rolls and Steak Bakes. We were pleased to partner with Fenwick - this
time to deliver The Golden Flake Tavern pop-up, where customers could enjoy
their Greggs meal in a pub atmosphere, complete with exclusive Greggs beers.
In November we partnered with Universal Pictures UK to launch the 'Wicked: For
Good' film. We held a day of special events in two iconic shops - London
Leicester Square and Manchester Trafford Centre - to mark the film's launch,
inviting customers to follow the Yellow Bake Road. We also created a 'Greggs x
Wicked Baked For Good' box for customers in our delivery channel.
A highlight of the year was the Greggs Sausage Roll establishing its status as
a British icon. Throughout the summer of 2025, a wax effigy of our famous bake
rested on a velvet cushion in Madame Tussauds - the first time a food item has
been honoured in this way - reminding us of the very real affection that
people have for the Greggs brand.
Range evolution and value leadership
We continue to keep our menu fresh and relevant, introducing new flavours and
products. Examples in 2025 included the Red Pepper, Feta and Spinach Bake,
the Sweet & Spicy Chicken Oval Bite, the Tuna Crunch Roll, and expansion
of our popular pizza range with a new Tandoori Chicken option. Our innovation
pipeline reflected emerging dietary trends with the launch of Turmeric and
Ginger shots, two protein shakes and a convenient Egg Pot, broadening choice
for customers looking for quick, healthy, high‑protein options.
Greggs has a track record of responding to changing dietary needs and entering
new categories with value-based options. High-protein options such as chicken
have been increasingly popular in recent years and we have grown share of
categories such as coffee, breakfast, vegan-friendly options and iced drinks.
Most recently we added iced matcha lattes to our popular iced drink range.
Priced from just £3.00, they are the latest example of Greggs embracing
market trends whilst making products more accessible to more people.
Increasing access to Greggs
Providing more convenient access to Greggs food and drink is crucial to our
success and continues to present a material growth opportunity in the years
ahead. Despite Greggs success over many years, increasing the frequency of
customer visits remains a clear opportunity when compared with best in class
for food-to-go.
By bringing our shops to more catchments, introducing convenient ways for
customers to pick up Greggs favourites, and offering services such as delivery
we enable customers to shop with us more frequently in a manner that suits
their busy lives. Increasingly this involves working in partnership with
others to extend access to Greggs beyond traditional locations, for example
roadsides, grocery retailers, and delivery partners. In every case we are
focused on ensuring that we generate strong returns on the capital that we
deploy.
As we grow our estate, we continually monitor customer behaviour to ensure
that new openings are not at risk of cannibalising existing shop sales.
Analysis of our Greggs App customers continues to demonstrate that those who
visit a new shop increase the overall frequency with which they visit Greggs.
In 2025 53% of our new shop openings (excluding relocations) were in areas
with no other Greggs shop within a mile (2024: 60% of new shop openings), with
2026 planned openings having a similar profile. For openings in areas with
existing access to Greggs within a mile of the new shop, the transfer of sales
from existing shops across 2024 and 2025 averaged less than 5%. We factor this
into our rigorous new shop appraisal process to ensure that increased access
to Greggs improves catchment performance and returns on investment.
Shop growth
In November 2025, we opened our 2,700(th) shop. Over the course of 2025, we
opened 121 net new shops, moved 50 existing shops to better locations in the
same area, and refitted 116 company-managed shops and 47 franchise shops.
Our growing presence now extends well beyond the high street, with over half
of our new openings located in alternative sites such as petrol forecourts,
supermarkets, retail parks, hospitals and university campuses. We remain
focused on expanding our presence in major transport hubs, opening new shops
this year at Manchester Airport and railway stations in Leeds and Dartford as
well as the western hall at St Pancras railway station in London. 2025 also
saw the launch of our first 'bitesize' shop at Sevenoaks railway station.
Some high‑footfall locations offer less space than is needed for a standard
Greggs shop, so we are trialling the new 'bitesize Greggs' format that enables
us to meet customer demand from a much more compact unit. In 2025, we opened
three bitesize shops, each offering a focused range of customer favourites,
and we are now assessing the role this format can play in supporting
profitable future growth. In addition to the bitesize trial, we are developing
unattended retail solutions to serve additional missions and further enhance
returns.
In addition to identifying new sites, relocating existing shops is an
important part of our strategy to develop the Greggs estate. During 2025, we
closed shops in 50 locations to make way for a better opportunity nearby or by
expanding into a vacant unit next door, allowing us to serve more customers
and expand our offer in that community. Relocating shops enables us to retain
the existing shop team whilst adding the space needed to serve more customers.
In these more traditional locations, typically in cities, towns and suburbs,
our customer base is already well established and further investment unlocks
swift and profitable growth. Since 2019 we have relocated circa 15% of our
estate in these traditional locations.
Greggs is a trusted brand offering a strong covenant to landlords and
franchise partners and this continues to generate attractive opportunities in
new locations. Our new shop pipeline is strong, and we expect to deliver
around 120 net openings in 2026, with the emphasis of our growth being in
locations where Greggs continues to be underrepresented, such as retail parks,
railway stations, airports, roadsides and supermarkets.
Delivery
Home delivery makes up 6.8% of our sales mix (6.7% in 2024) and Greggs is now
ranked number four in the market for delivery (source: Circana, 12 months
ended December 2025). Three quarters of our company-managed shops now accept
orders via Just Eat and Uber Eats. Delivery sales are incremental to our
walk-in business. The basket value of a delivery order tends to be around
three times that of a walk-in customer, so we continue to look for ways to
extend the reach of this offer with the evening daypart remaining a key
opportunity. In the overall market, home delivery continues to grow and is at
its most popular in the evening daypart. This remains an opportunity for
Greggs as we adapt products to suit the delivery channel. For example more
than 70% of our sales of pizza boxes are made via our delivery partners.
The success of our delivery business relies upon slick processes, and we are
constantly searching for ways to reduce complexity and simplify our
operations. We are now investing in a platform to better manage menu
availability and improve the amount of time our shops are online. We have
also trialled courier estimated arrival time functionality with Uber Eats so
we can better anticipate when food will be collected, allowing us to make up
an order so it is as fresh as possible.
Loyalty
The Greggs App remains very popular with our regular customers, giving them a
free product for every nine they buy. Another 1.7 million customers downloaded
the app in 2025 and it is now scanned in more than a quarter of
company-managed transactions (26.7%, up from 20.1% in the previous year). At
the peak in December 2025, the app was used by over 1.5 million customers a
week - over three times more than the December peak in 2022.
In May, we introduced a personalised inbox, Baked for You, to the Greggs App,
giving us more space to promote new products and deals. In November, we
launched Greggs Quests to 'gamify' the app user experience and provide more
opportunities to drive engagement and frequency of purchase by accelerating
rewards for customers if they complete their Quest. By completing Greggs
Quests, customers had the opportunity to win a range of prizes - from products
and gift cards to a trip to Reykjavik with Universal Pictures as part of our
Wicked partnership.
Evening growth
Around 2,000 Greggs shops are open beyond 5pm, and at least half of these are
open until 7pm. Evening sales represent 9.4% of company-managed shop sales
(2024: 9.0%) and remained our fastest-growing daypart in 2025. We are now
ranked number four in the market for dinner visits (source: Circana, 12 months
ended December 2025) as we continue to take market share.
Most of our evening sales come from walk‑in customers on grab‑and‑go
missions, with our iconic savouries and pizza remaining the backbone of these
visits. Alongside this, we're strengthening our offer for sit‑in and
delivery occasions by providing hot, filling meal options. Products like
Southern Fried Chicken Goujons, Southern Fried Potato Wedges and Mozzarella
& Cheddar Bites are key drivers of like‑for‑like volume growth in the
evenings, and this year we expanded the range further with Mac & Cheese.
We've also continued to test and refine our pizza offer, introducing a new
small pizza box and a single slice pizza box exclusively for delivery.
Product innovation will continue to be central to our evening growth strategy.
Grocery retailing
Iceland Foods continues to be a key commercial partner, and in 2025 we added
new pastries to the Greggs 'Bake at Home' range and expanded the rotational
programme of limited-edition products. During the year we also launched
elements of the range with Tesco, and Greggs products are now available at 800
larger Tesco stores and online. From January 2026 a subset of this range
became available in a further 1,900 Tesco Express stores.
Managing costs and capital investment
Managing costs closely is, and always has been, strategically important to us
as a value retailer. Our teams delivered structural cost savings of £13.0
million in 2025, £4 million ahead of our stretch target, alongside short-term
tactical control to manage labour and other key variable costs. This will
remain a focus in 2026 and going forward as we explore further structural cost
efficiency opportunities to increase productivity and support strong returns
for shareholders.
Our plans to open new National Distribution Centres in Derby and Kettering
remain on time and are both on track to come in under budget. At the Derby
site, we will be ready to roll out upstream robotic picking of frozen goods
from mid-2026. The 23-acre site will be fully operational by the end of 2026,
including our first production line on the site, adding capacity to both our
manufacturing and logistics operations. Our Kettering site will embrace
increased levels of automation to enable upstream picking of chilled and
ambient goods, relieving pressure on our existing Radial Distribution
Centres. The site will be operational in 2027 and we have begun appointing
key individuals to manage this operation.
2025 was the peak of our capital investment programme and we are now focused
on completing and activating the new facilities to utilise their
capabilities. Free cash generation will increase going forward as our
investment requirements reduce materially. This will improve returns as we
move forward, leveraging the investments we have made.
We continue to invest in upgrading our logistics infrastructure and
modernising our fleet of vehicles. During 2025, we purchased more efficient
double-deck trailers and introduced 25 urban artics, both of which will take
miles off the road. We now use the renewable biofuel HVO at three sites,
meaning that 28% of our fuel usage has been switched to a renewable fuel
source. Building on this progress, we are exploring opportunities to expand
HVO usage across our Leeds and Kettering logistics sites in 2026, aiming,
where viable, to support increased adoption and further reduce emissions. In
addition, the introduction of real-time data through vehicle telematics has
enabled us to improve operational efficiencies, cut emissions, and improve
safety compliance and driver performance.
During 2025 we successfully migrated our finance and procurement team
processes to the SAP S/4HANA platform, strengthening the foundations for
greater efficiency along with data and insight capabilities across the
business. We further developed our use of Power BI and Microsoft AI tools to
support decision making. These developments are already helping us unlock
greater value from the vast volumes of data we manage. For example, we've
expanded the insight available to operational teams with a single view of
performance metrics across our supply chain, and we now provide real-time
sales updates to shops so they can make intraday decisions on labour
scheduling.
We've also introduced insight that helps teams understand how operational
choices affect queue times and service levels, and we're generating richer
views of customer purchase behaviour highlighting the positive impact of the
Greggs App and our loyalty scheme. We continue to experiment with ways to
transform our business using digital solutions. In 2025, we trialled
self-service ordering screens in a small number of shops, offering our
customers a convenient way to order and pay without queuing. At our Head
Office our support teams are benefiting from the investment in CRM capability,
with AI functionality being developed to drive service standards and
efficiencies. These enhancements continue to strengthen our data and AI
capabilities and improve our ability to run efficient, well-informed
operations.
Looking after our people
We are proud to employ more than 33,000 people across the UK in stable,
fairly-paid jobs. In a wider environment of rising unemployment, we are proud
to be creating new jobs; in opening 121 net new shops we added over 1,200
colleagues to our team.
Everyone who works for Greggs benefits from a 50% colleague discount on
Greggs-branded products from the day they start work. After three months with
us, they can opt into our Sharesave scheme, enabling them to buy Greggs shares
at a discount, and after six months they also become eligible for our
longstanding profit share scheme. Every year, 10% of the profits we generate
are divided between these colleagues and, at the end of March 2026, each will
receive a share of £20.2 million.
We also offer a matched contribution pension scheme, of up to 7% of salary,
for all colleagues. With our contribution, colleagues can set aside the
equivalent of 14% of every pay packet, helping them to save for retirement.
We want to take good care of our people and, in spring 2025, introduced a
virtual GP service which enables them to speak to a private doctor, at no cost
to them. At a time when getting a doctor's appointment feels increasingly
challenging, this service removes some of the friction that can make it harder
to seek expert advice.
Our colleague inclusion networks empower our colleagues from minority groups
(and their allies) to come together to share their experiences and provide
guidance and feedback to the business. We held our second Inclusion Conference
to celebrate our success stories and discuss ways we can improve further.
Giving back
In addition to paying taxes and providing stable employment to tens of
thousands of people across the country, we give back to our communities
through charitable support.
The Greggs Foundation
Every year, Greggs plc donates 1% of pre-tax profits to the Greggs Foundation.
We also work collaboratively to leverage the ability of our Outlet shops to
support their local community. In 2025, this support amounted to £3.4
million. Our colleagues and customers give generously throughout the year,
raising a further £420,000 through donations at the till, our two Breakfast
Club appeal weeks and colleagues' Give As You Earn donations.
Children in Need
2025 was our 19(th) year supporting BBC Children in Need. During November, we
raised over £1 million for the charity through shop collections, merchandise,
Pudsey Biscuits, and till donations.
Children's Cancer North
We are long-time supporters of Children's Cancer North's annual charity run,
which takes place each May in Newcastle upon Tyne. As well as providing
funding towards the delivery of the event, we put collection buckets in our
shops in the North East and increased local awareness of the event. We have
raised £9 million for the charity since we began supporting them back in
1983.
The Greggs Pledge
We created the Greggs Pledge in 2021 to channel resources and energy into the
areas where we felt our business could make the most difference to the wider
world. We have spent the five years since it was launched working to deliver
ten bold commitments, with the end of 2025 as our target delivery date. I am
incredibly proud of the progress that we have made.
We are now entering a new five-year cycle, with an evolved set of commitments.
As our approach to ESG and sustainability has matured, our ambitions have
grown; our new targets reflect that and will require real focus and effort in
the years ahead.
In some cases, a target that we set in 2021 has been delivered in full.
Typically, this means that the required change has been embedded into
'business as usual' and will now be delivered by existing processes. For
example, our Eco-shops are now fully operational and are on-going test-beds
for new, 'greener' equipment and technology, and any new item of packaging
will always be made from fully recyclable material.
Our priorities for the next five years are based around the same three
pillars: building stronger, healthier communities; making our planet safer;
and striving to be a better business. We are focusing on empowering broader
community action through The Greggs Foundation's Community Action Fund,
maintaining our climate ambition to reach Scope 2 net zero by 2030, and stay
firmly on track for full net zero across Scopes 1-3 by 2040, and we are
accelerating progress on our diversity agenda by building a more diverse
leadership pipeline.
Further detail on each of these pillars can be found in The Greggs Pledge
section of the Annual Report and Accounts 2025.
A forward look
We expect that 2026 will be another tough year for the consumer but are
optimistic that inflationary pressure will ease a little, providing some
support to consumers and the food-to-go sector.
We will continue to open new Greggs shops, primarily in catchments where we do
not yet have a presence. Our flexible formats and growing presence in areas
such as petrol forecourts and retail parks will continue to improve access to
Greggs whilst further diversifying our shop estate.
Our loyalty proposition will encourage customers to shop with us more
frequently and at different times of the day, supported by continued evolution
of our product range to suit different dayparts and respond to dietary trends.
The key focus for management in the coming years will be restoring the
Company's return on capital employed ("ROCE") back to our target of around
20%. This will be supported by continued action to drive like-for-like sales,
deliver structural cost reductions and develop additional income streams,
alongside opening more shops that deliver strong returns and leverage the new
supply chain capacity that we are building.
Current trading and outlook
We have a strong pipeline of new shop openings in 2026, primarily in new
catchments that drive strong returns, and our investment in supply chain
capacity is on track. Like-for-like sales in company-managed shops have
increased by 1.6% year-on-year in the first nine weeks of 2026. Total sales
increased by 6.3% year-on-year as we continued to grow our shop estate and
benefited from the expansion of our grocery retail business, with strong cost
control supporting profit conversion and year-on-year progression.
Our strong brand and robust balance sheet position us well and management's
expectations for the year remain unchanged, with profit before tax expected to
be broadly in line with 2025 and any year-on-year improvement contingent on a
recovery in the consumer backdrop. We expect to make profit progress in the
first half of 2026 due to the phasing of like-for-like cost inflation across
the year and will see an increase in fixed costs as we commission the new
Derby site, which will primarily impact the second half.
I remain confident about the growth opportunities available to Greggs and our
ability to progress them.
Roisin Currie
Chief Executive
3 March 2026
Financial review
Despite challenging market conditions in 2025, Greggs delivered further sales
growth through new shop openings, the development of further partnerships that
improve access to the brand and continued progress in the evening daypart and
delivery channel. Subdued consumer confidence impacted trading but the
Company's growth strategy remains intact, with work progressing to develop
additional income streams and accelerate cost efficiencies. This, along with
the leveraging of new logistics capacity, will support the medium-term plan to
restore returns in line with our historic targets.
2025 2024
£m £m Variance
Revenue 2,151.2 2,014.4 +6.8%
Underlying operating profit 187.5 195.3 -4.0%
Finance income 1.8 8.1 -77.8%
Finance expense (17.4) (13.6) +27.9%
Underlying profit before tax 171.9 189.8 -9.4%
Cost of prior year VAT correction (4.5) -
Exceptional income - 14.1
Profit before tax 167.4 203.9 -17.9%
Income tax (45.2) (50.5) -10.5%
Profit after tax 122.2 153.4 -20.3%
Underlying diluted earnings per share 122.8p 137.5p -10.7%
Underlying return on capital employed 16.0% 20.3%
Sales
Total Group sales for the 52 weeks ended 27 December 2025 grew by 6.8% to
£2,151 million (2024: £2,014 million). Growth was delivered through both new
shop openings and like-for-like sales growth in existing shops.
Company-managed like-for-like sales grew by 2.4% in the year, whilst
like-for-like 'system sales' in franchised units rose by 4.3%. Total Group
revenue reflects sales from company-managed shops, which include delivery
sales, and sales through the business-to-business channel to our franchise and
grocery retail partners.
Reporting like-for-like sales (sales in shops with more than one calendar
year's trading history) is a key alternative performance measure for Greggs,
as it shows underlying sales performance excluding the impact of new shop
openings and closures. In 2025 like-for-like sales growth was limited by
challenging market conditions and particularly impacted by prolonged high
temperatures experienced in June and July. The performance of shops managed by
franchise partners proved more resilient to market conditions, being primarily
focused on roadside locations.
Profit for the year
Underlying operating profit (profit before net finance charges, exceptional
items and tax) was £187.5 million in 2025 (2024: £195.3 million) and
underlying profit before tax (profit before exceptional items and tax) was
£171.9 million (2024: £189.8 million). Underlying operating profit margin
was 8.7% in 2025 (2024: 9.7%). After exceptional items profit before
taxation was £167.4 million in 2025 (2024: £203.9 million after exceptional
income). The year-on-year profit position reflected challenging market
conditions, compounded by the spell of particularly hot weather that had a
material impact on footfall and consumer behaviour. Profit before tax included
the one-off impact of accounting for £4.5 million related to previous years'
VAT costs. The net exceptional gain of £14.1 million in 2024 primarily
related to the sale of a legacy supply chain site.
The business experienced overall like-for-like cost inflation of around 5.5%
in 2025. This was primarily driven by employment costs, including the impact
of the increase in employer's National Insurance contributions from April
2025, and rising costs of food and packaging. Energy costs marginally
increased and our shop occupancy cost ratio (shop costs such as rent, rates
and service charges as a percentage of sales) was stable.
Looking forward we expect like-for-like costs to be less inflationary in 2026,
with overall input cost inflation of around 3%. Employment cost inflation will
again be the biggest driver of higher costs, but at a lower level than seen in
recent years, reflecting changes to the National Living Wage. We currently
have good levels of forward cover for commodity costs, with 100% of our
electricity requirements fixed for the year and forward purchase agreements in
place representing circa four months of our food and packaging needs.
Offering great value to customers is key to our strategic purpose, and we
leverage our scale and vertical integration to keep costs low. We have a
rolling programme of cost-saving initiatives with the aim of mitigating as
much cost pressure as possible and in 2025 this delivered £13.0 million of
savings (2024: £10.6 million). Through the programme we look to leverage the
benefits of our vertical integration in manufacturing and logistics
operations, completing end-to-end process reviews to optimise the way that we
procure and utilise resources. The strength of our financial covenant, coupled
with our scale, helps us secure the best possible procurement rates.
To the extent that we cannot mitigate cost inflation through savings, we
recover it through careful pricing activity, whilst ensuring that we protect
our reputation for offering great value, great quality products. We
continually compare our prices with the market across a range of products and
ensure that our relative price proposition remains strong, and at a strong
discount compared to other food-to-go specialists. Our prices are comparable
to the grocery sector, however, our food and drink offering is freshly
prepared in shops each day. Our analysis of Greggs prices against the market
demonstrates that this value position has been maintained and improved through
the cycle of cost inflation seen in the market over recent years.
Investment and returns
2025 was the peak year of our investment in capital expenditure as we
developed the logistics infrastructure that will support the next phase of
growth. When complete, we will have the logistics capacity to support a
network of 3,500 shops in the medium term and the flexibility to extend this
further if appropriate.
As we have previously guided, the development and commissioning of these sites
will bring additional operating and financing costs in the short term, which
will subsequently be leveraged as the new facilities allow us to open further
profitable new shops.
Greggs targets a ROCE of around 20% and this remains one of our key
objectives. The impact of our investments on margin and capital employed
remains in line with our plans but the operating conditions in the market at
present have presented an additional headwind. In 2025 underlying ROCE was
16.0%, reflecting this headwind and the planned increase in capital employed
(2024: 20.3% underlying). The ratio will reduce further in 2026 as the new
distribution facilities in Derby and Kettering are brought into use.
Thereafter we expect ROCE to stabilise in 2027 before recovering from 2028
onwards, driven by:
· Our shop opening programme, adding attractive new locations with strong
returns that utilise the capacity we are creating to reach customers more
frequently
· Continued relocation of a proportion of our traditional shop estate
to stronger locations, improving their returns on capital
· A disciplined approach to capital allocation with a material reduction
in the Company's requirement for capital expenditure, starting in 2026 as
discussed below
· Further structural cost efficiency opportunities increasing
productivity
· Wider market performance and the generation of additional income
streams as we capitalise on the appeal of the Company's brand, infrastructure
and products
This activity is designed to recover the Company's ROCE toward the 20% target.
The pace of this will clearly be affected by market conditions but we believe
that Greggs is well placed to weather the short-term pressures whilst also
benefiting as the consumer environment improves.
Financing charges
We earned £1.8 million (2024: £8.1 million) of finance income on cash
deposits during the year as we deployed cash to support our investment in
logistics capacity, and incurred finance expenses of £18.1 million (2024:
£13.6 million) which comprised £16.7 million (2024: £13.0 million) in
respect of the IFRS 16 interest charge on lease liabilities and an aggregate
£1.4 million (2024: £0.6 million) of charges under the Company's revolving
credit facility (RCF), interest on the defined benefit pension liability,
foreign exchange losses and a provision of £0.7 million in respect of
interest payable on the historic sales tax correction.
Taxation
The Group has a simple corporate structure, carries out its business entirely
in the UK and all taxes are paid here. We aim to act with integrity and
transparency in respect of our taxation obligations.
The Group's overall effective tax rate on profit in 2025, including the impact
of exceptional items, was 27.0% (2024: 24.8%) whilst the underlying effective
rate for the year was 26.8% (2024: 25.7%). The headline rate for the year was
25.0% (2024: 25.0%). The overall effective tax rate was higher than the
headline rate due to expenditure for which no tax relief is available, such as
depreciation on properties acquired before the introduction of structures and
buildings tax allowances, and acquisition costs relating to new shops, as well
as the reduction in the Company's share price during the year, which results
in a lower deduction available on share option exercises.
We expect the effective tax rate for 2026 to be around 26.0% and going forward
the effective rate is expected to remain around one percentage point above the
headline corporation tax rate. This is principally explained by expenditure
for which no tax relief is available, as outlined above.
Earnings per share, cash inflow per share and dividend
Underlying diluted earnings per share in 2025 were 122.8 pence (2024: 137.5
pence per share). Including exceptional items diluted earnings per share were
119.3 pence (2024: 149.6 pence per share including net exceptional income).
Diluted operating cash inflow per share grew by 4.6% in 2025 to 267.1 pence
(2024: 255.4 pence).
The Board recommends a final ordinary dividend of 50.0 pence per share (2024:
50.0 pence per share). Together with the interim dividend of 19.0 pence per
share (2024: 19.0 pence per share) paid in October 2025, this makes a total
ordinary dividend for the year of 69.0 pence per share (2024: 69.0 pence per
share). The Board recommends maintaining the ordinary dividend through this
investment phase, before returning to an ordinary dividend that is covered two
times by underlying diluted earnings per share. This is in line with our
progressive ordinary dividend policy, which aims to increase the dividend in
line with growth in underlying earnings per share.
Subject to the approval of shareholders at the AGM, the final ordinary
dividend will be paid on 29 May 2026 to shareholders on the register at 1 May
2026.
Balance sheet
Capital expenditure
We invested a total of £287.5 million in capital expenditure during 2025
(2024: £249.0 million). Retail estate expenditure was lower year-on-year due
to a reduction in the number of company-managed shop openings, relocations and
refurbishments. Supply chain capital expenditure increased as we purchased the
land for our chilled and ambient National Distribution Centre in Kettering and
progressed the build of that site, whilst also continuing the fit-out of our
new frozen National Distribution Centre in Derby. IT investment increased as
we progressed the upgrading of our ERP system to SAP S/4HANA.
Depreciation and amortisation on property, plant and equipment and intangibles
in the year was £95.4 million (2024: £80.8 million). A further £65.2
million (2024: £59.2 million) of depreciation was charged in respect of
right-of-use assets on capitalised leases.
2025 was the peak year of our capital investment programme and, as previously
communicated, expenditure will reduce materially from this point. Our shop
opening and relocation plans mean that we will invest in circa 135 new
company-managed shops in 2026 and refurbish around 45 existing company-managed
shops. In our retail estate we continue to target a 25% cash return on
investment on new shops and typically exceed this level after two to three
years as shops mature. Our acquisition strategy is targeting shops that have
higher than average sales and returns and, being mainly in new catchments, do
not impact on the sales of other shops in the estate.
Overall, we expect capital expenditure in 2026 to be around £200 million in
line with previous guidance. From 2027 onwards we currently expect capital
expenditure to reduce further to a range of £150-170 million. At these levels
the Company's strong operating cash generation creates material capacity for
cash returns.
Working capital
We ended the year with Group net current liabilities of £151.8 million (2024:
£67.3 million) as our cash and cash equivalents balance was deployed in line
with our capital investment plans. The stock balance was stable and debtor
levels increased primarily due to sales growth. The net current liabilities
position reflects supplier funding as we receive payment from company-managed
shop customers ahead of paying suppliers on standard terms.
Pension scheme
The Company's closed defined benefit pension scheme has a bulk annuity
'buy-in' policy with Aviva, which provides regular payments to the scheme
Trustee to fund pension payments. This significantly reduces the Company's
exposure to the funding risks associated with its defined benefit pension
liabilities. As a result, the scheme is in a net liability position of £0.3
million (2024: £0.4 million net liability), reflecting the largely derisked
position that it now benefits from.
Cash flow and capital structure
The net cash inflow from operating activities after lease payments in the year
was £273.7 million (2024: £261.9 million). The strength of cash generation
reflected the growth in cash profits, excluding non-cash depreciation and
amortisation charges. At the end of the year the Group had net cash and cash
equivalents of £45.8 million (2024: £125.3 million), representing £70.8
million of cash and cash equivalents, offset by £25 million drawn on the
Company's RCF.
Our RCF is committed until June 2028, with a further one-year extension
option. The facility provides liquidity of £100 million in committed funds.
Taking this into account, total available liquidity at the end of 2025 was
£145.8 million (2024: £225.3 million).
Our approach to capital allocation can be described as a series of priorities:
1. Invest to adequately maintain the business in order to support its
continued success. In normal circumstances we expect maintenance capital
expenditure to be around 5% of revenue. The level of maintenance capital
expenditure will reduce following the significant investment in the new sites
in Derby and Kettering.
2. Maintain a strong balance sheet. Reflecting the inherent gearing in the
Group's leaseholds and working capital we aim, in normal circumstances, to
maintain a year-end net cash position of circa 3% of revenue in order to allow
for seasonality in the working capital cycle and to protect the interests of
all creditors.
3. Deliver an attractive ordinary dividend to shareholders. We continue to
target a progressive ordinary dividend, normally around two times covered by
underlying profit after taxation.
4. Selectively invest to grow. We will continue to invest in opportunities
that deliver attractive returns, including the expansion of our estate and to
support the generation of additional income streams where relevant.
5. Return surplus cash to shareholders. Where net cash on the balance sheet
exceeds our minimum requirement, taking into account that reserved for growth
investments, we expect to return cash to shareholders by way of either special
dividends or share buybacks.
Looking forward
The significant investments we are making to support further profitable growth
create short-term ROCE and margin headwinds as we bring important new sites
into our supply chain in a period where underlying trading has seen pressure
from market operating conditions. Our investment in additional capacity will
enable Greggs to realise the medium-term opportunity to grow its estate and
expand into new channels, whilst also progressing opportunities to develop
additional income streams and accelerate structural cost savings. In doing
so, we remain focused on driving strong returns on capital, with consequential
benefits for all our stakeholders.
Richard Hutton
Chief Financial Officer
3 March 2026
Greggs plc
Consolidated income statement
for the 52 weeks ended 27 December 2025 (2024: 52 weeks ended 28 December
2024)
2025 2025 2025 2024 2024 2024
Excluding exceptional items Exceptional items Total Excluding exceptional items Exceptional items Total
(see note 3) (see note 3)
£m £m £m
Revenue 2,151.2 - 2,151.2 2,014.4 - 2,014.4
Cost of sales (829.1) - (829.1) (770.8) - (770.8)
________ ________ ________ ________ ________ ________
Gross profit 1,322.1 - 1,322.1 1,243.6 - 1,243.6
Distribution and selling costs (1,036.3) - (1,036.3) (950.4) 0.3 (950.1)
Administrative expenses (98.3) (3.8) (102.1) (97.9) - (97.9)
Other income - - - - 13.8 13.8
________ ________ ________ ________ ________ ________
Operating profit 187.5 (3.8) 183.7 195.3 14.1 209.4
Finance income 1.8 - 1.8 8.1 - 8.1
Finance expense (17.4) (0.7) (18.1) (13.6) - (13.6)
________ ________ ________ ________ ________ ________
Profit before tax 171.9 (4.5) 167.4 189.8 14.1 203.9
Income tax (46.1) 0.9 (45.2) (48.8) (1.7) (50.5)
________ ________ ________ ________ ________ ________
Profit for the financial year attributable to equity holders of the Parent
125.8 (3.6) 122.2 141.0 12.4 153.4
======= ======= ======= ======= ======= =======
Basic earnings per share 123.5p (3.5p) 120.0p 138.5p 12.2p 150.7p
Diluted earnings per share 122.8p (3.5p) 119.3p 137.5p 12.1p 149.6p
Greggs plc
Consolidated statement of comprehensive income
for the 52 weeks ended 27 December 2025 (2024: 52 weeks ended 28 December
2024)
2025 2024
£m £m
Profit for the financial year 122.2 153.4
Other comprehensive income
Items that will not be recycled to profit or loss:
Remeasurements on defined benefit pension plans 0.1 (11.9)
Tax on remeasurements on defined benefit pension plans - 0.9
________ ________
Other comprehensive income for the financial year, net of income tax 0.1 (11.0)
________ ________
Total comprehensive income for the financial year 122.3 142.4
======= =======
Greggs plc
Consolidated balance sheet
at 27 December 2025 (2024: 28 December 2024)
2025 2024
£m £m
ASSETS
Non-current assets
Intangible assets 43.0 24.9
Property, plant and equipment 832.1 664.7
Right-of-use assets 413.0 387.2
Defined benefit pension asset - -
________ ________
1,288.1 1,076.8
Current assets
Inventories 55.7 55.2
Trade and other receivables 69.4 62.4
Cash and cash equivalents 70.8 125.3
________ ________
195.9 242.9
________ ________
Total assets 1,484.0 1,319.7
________ ________
LIABILITIES
Current liabilities
Trade and other payables (272.8) (243.9)
Current tax liabilities (2.1) (9.1)
Lease liabilities (62.5) (53.8)
Short-term provisions (10.3) (3.4)
________ ________
(347.7) (310.2)
Non-current liabilities
Borrowings (25.0) -
Other payables (1.4) (1.8)
Lease liabilities (387.3) (361.3)
Deferred tax liability (93.7) (72.6)
Long-term provisions (3.4) (2.9)
Defined benefit pension liability (0.3) (0.4)
________ ________
(511.1) (439.0)
________ ________
Total liabilities (858.8) (749.2)
________ ________
Net assets 625.2 570.5
======= =======
EQUITY
Capital and reserves
Issued capital 2.0 2.0
Share premium account 25.1 25.1
Capital redemption reserve 0.4 0.4
Retained earnings 597.7 543.0
________ ________
Total equity attributable to equity holders of the Parent 625.2 570.5
======= =======
Greggs plc
Consolidated statement of changes in equity
for the 52 weeks ended 27 December 2025 (2024: 52 weeks ended 28 December
2024)
52 weeks ended 28 December 2024
Attributable to equity holders of the Company
Issued capital Share premium Capital redemption reserve Retained earnings Total
£m £m £m £m £m
Balance at 31 December 2023 2.0 25.1 0.4 503.4 530.9
Total comprehensive income for the year
Profit for the financial year - - - 153.4 153.4
Other comprehensive income - - - (11.0) (11.0)
________ ________ ________ ________ ________
Total comprehensive income for the year - - - 142.4 142.4
Transactions with owners, recorded directly in equity
Purchase of own shares - - - (5.0) (5.0)
Sale of own shares - - - 4.7 4.7
Share-based payment transactions - - - 4.5 4.5
Dividends to equity holders - - - (106.8) (106.8)
Tax items taken directly to equity - - - (0.2) (0.2)
________ ________ ________ ________ ________
Total transactions with owners - - - (102.8) (102.8)
________ ________ ________ ________ ________
Balance at 28 December 2024 2.0 25.1 0.4 543.0 570.5
======= ======= ======= ======= =======
Greggs plc
Consolidated statement of changes in equity (continued)
52 weeks ended 27 December 2025
Issued capital Share premium Capital redemption reserve Retained earnings Total
£m £m £m £m £m
Balance at 29 December 2024 2.0 25.1 0.4 543.0 570.5
Total comprehensive income for the year
Profit for the financial year - - - 122.2 122.2
Other comprehensive income - - - 0.1 0.1
________ ________ ________ ________ ________
Total comprehensive income for the year - - - 122.3 122.3
Transactions with owners, recorded directly in equity
Sale of own shares - - - 1.6 1.6
Share-based payment transactions - - - 1.5 1.5
Dividends to equity holders - - - (70.3) (70.3)
Tax items taken directly to equity - - - (0.4) (0.4)
________ ________ ________ ________ ________
Total transactions with owners - - - (67.6) (67.6)
________ ________ ________ ________ ________
Balance at 27 December 2025 2.0 25.1 0.4 597.7 625.2
======= ======= ======= ======= =======
Greggs plc
Consolidated statement of cash flows
for the 52 weeks ended 27 December 2025 (2024: 52 weeks ended 28 December
2024)
Group
2025 2024
(Restated)
£m £m
Operating activities
Cash generated from operations (see below) 383.7 352.6
Income tax paid (31.5) (27.7)
Interest received 2.1 7.7
Interest paid on lease liabilities (16.7) (13.0)
Interest paid on borrowings and other related charges (0.6) (1.0)
________ ________
Net cash inflow from operating activities 337.0 318.6
________ ________
Investing activities
Acquisition of property, plant and equipment (263.3) (230.0)
Acquisition of intangible assets (22.1) (10.9)
Proceeds from sale of property, plant and equipment 0.9 16.1
________ ________
Net cash outflow from investing activities (284.5) (224.8)
________ ________
Financing activities
Proceeds from borrowing 40.0 -
Repayments of borrowing (15.0) -
Sale of own shares 1.6 4.7
Purchase of own shares - (5.0)
Dividends paid (70.3) (106.8)
Repayment of principal on lease liabilities (63.3) (56.7)
________ ________
Net cash outflow from financing activities (107.0) (163.8)
________ ________
Net (decrease) in cash and cash equivalents (54.5) (70.0)
Cash and cash equivalents at the start of the year 125.3 195.3
________ ________
Cash and cash equivalents at the end of the year 70.8 125.3
======= =======
There has been a voluntary change in accounting policy whereby interest
received has been included as an operating activity instead of an investing
activity, which the Group considers better reflects the nature of the cash
inflows. The prior year total for net cash inflow from operating activities
has been increased by £7.7million with a corresponding decrease in net cash
outflow from investing activities. There is no change to the net decrease in
cash and cash equivalents in 2024.
Consolidated statement of cash flows - cash generated from operations
2025 2024
£m £m
Profit for the financial year 122.2 153.4
Amortisation 4.7 4.2
Depreciation - property, plant and equipment 90.7 76.6
Depreciation - right-of-use assets 65.2 59.2
Net impairment charge - property, plant and equipment 3.9 2.9
Impairment charge - right-of-use assets 3.0 2.1
Loss / (profit) on sale of property, plant and equipment 1.7 (11.8)
Release of government grants (0.5) (0.5)
Share-based payment expenses 1.5 4.5
Finance income (1.8) (8.1)
Finance expense 18.1 13.6
Income tax expense 45.2 50.5
Increase in inventories (0.4) (6.4)
Increase in receivables (7.4) (8.1)
Increase in payables 31.6 24.9
Increase in provisions 6.0 0.1
Defined benefit pension scheme special contribution - (4.5)
________ ______
Cash generated from operations 383.7 352.6
======= ======
Greggs plc
Notes
1. Basis of preparation and accounting policies
The preliminary announcement has been prepared in accordance with
international accounting standards in conformity with the requirements of the
Companies Act 2006 and, as regards the Group accounts, UK-adopted
International Accounting Standards. It does not include all the information
required for full annual accounts.
The financial information set out above does not constitute the Company's
statutory accounts for the years ended 27 December 2025 or 28 December 2024
but is derived from these accounts. Statutory accounts for the 52 weeks
ended 28 December 2024 have been delivered to the registrar of companies, and
those for the 52 weeks ended 27 December 2025 will be delivered in due
course. The auditor has reported on those accounts; the audit reports were
(i) unqualified, (ii) did not include a reference to any matters to which the
auditor drew attention by way of emphasis without qualifying their report and
(iii) did not contain a statement under section 498 (2) or (3) of the
Companies Act 2006.
The preliminary announcement has been prepared using the accounting policies
published in the Group's accounts for the 52 weeks ended 28 December 2024,
which are available on the Company's website www.greggs.co.uk
(http://www.greggs.co.uk) . From 29 December 2024 the following amendment
was adopted by the Group:
· Lease liability in sale and leaseback - Amendments to IFRS 16
· Supplier Finance Arrangements - Amendments to IAS 7 and IFRS 17
The adoption of these standards did not have a material effect on the
accounts.
Going concern
The Directors have considered the adoption of the going concern basis of
preparation for these accounts in the context of recent trading performance,
macro-economic conditions and the trading outlook of the Group. At the end of
the reporting period the Group had available liquidity totalling £145.8
million, comprised of cash and cash equivalents of £70.8 million (including a
£25.0 million drawdown on the revolving credit facility ("RCF")) plus the
undrawn element of the RCF of £75.0 million, which is committed to June 2028
with a further one-year extension option. The RCF includes financial covenants
that the Group must comply with related to maximum leverage and a minimum
fixed charge cover.
The Directors have reviewed cash flow forecasts prepared for the period up to
December 2027 as well as covenant compliance for that period. In reviewing the
cash flow forecasts the Directors considered the current trading performance
of the Group and the likely capital expenditure and working capital
requirements of its growth plans.
After reviewing these cash flow forecasts and making enquiries, the Directors
are confident that the Company and the Group will have sufficient funds to
continue to meet their liabilities as they fall due for at least 12 months
from the date of approval of the accounts.
Accordingly, they continue to adopt the going concern basis in preparing the
annual report and accounts.
Consideration of climate risk matters
The Group continues to assess the impact of climate risk matters on many
aspects of the business, including climate-related scenario analysis as
required by the Task Force on Climate-related Financial Disclosures. Building
on this scenario analysis, consideration has been given to the impact of
climate-related risk on management judgements and estimates, and compliance
with existing accounting requirements. Any incurred costs and investments
associated with our sustainability strategy are reflected in the Group's
accounts. The impact of climate-related risk matters is not expected to be
material to these consolidated accounts, the Group going concern assessments
to December 2027, or the viability of the Group over the next three years.
Judgements and estimates
In preparing this preliminary announcement, management have made judgements
and estimates that affect the application of accounting policies and the
reported amounts of assets and liabilities, income and expense. Actual
results may differ from these estimates.
Impairment (estimation)
Property, plant and equipment and right-of-use assets are reviewed for
impairment if events or changes in circumstances indicate that the carrying
value may not be recoverable. For example, shop fittings and right-of-use
assets may be impaired if sales in that shop fall. When a review for
impairment is conducted the recoverable amount is estimated based on the
higher of the value-in-use calculations or fair value less costs of disposal.
Value-in-use calculations are based on management's estimates of future cash
flows generated by the assets and an appropriate discount rate. Consideration
is also given to whether the impairment assessments made in prior years remain
appropriate based on the latest expectations in respect of recoverable
amounts. Where it is concluded that the impairment has reduced, a reversal of
the impairment is recorded to the carrying value that would have been
recognised if the original impairment had not occurred, net of depreciation
that would have been charged.
The Group has traded profitably throughout 2025; however volumes have been
under pressure from reduced consumer spending impacting the wider food-to-go
market. The volume pressure and increased fixed costs related to
manufacturing, logistics and technology capacity have resulted in profit
before tax excluding exceptionals reducing by 9.4% to £171.9 million. Despite
this fall in profits the Group remains highly cash generative with the net
cash inflow from operating activities after lease payments increasing to
£273.7 million (2024: £261.9 million). As such there is not considered to be
a global indicator of impairment across the Group's asset base. Where
indicators of impairment exist for specific cash-generating units (CGUs), with
each individual shop considered a CGU, then an impairment review has been
performed to calculate the recoverable value. The Group as a whole
(comprising both company-managed shops and business-to-business) is also
considered a group of CGUs for impairment testing purposes.
For those shops with indications of impairment, the value-in-use has been
calculated using the following assumptions:
• Like-for-like sales for shops with more than two years trade has been
assumed to grow at a rate of 2.4% for year one of the period of the impairment
review, reducing to 1.5% for years two and three, before increasing to 3.0% in
years four and five as volumes are assumed to recover. No growth has been
assumed for year six onwards;
• Earnings before interest, tax, depreciation, amortisation and rent
(EBITDAR) is used as a proxy for net cash flow excluding rental payments;
• In valuing individual shop CGUs, central overheads have been allocated
to the CGUs to the extent that management consider them to be directly
attributable or capable of being reasonably allocated with reference to shop
sales, in order to assess recoverability of those shop assets. The group of
CGUs as described above is then assessed for impairment considering all
overheads of the business, including those not allocated to individual shop
CGUs;
• The discount rate is based on the Group's pre-tax cost of capital and
at 27 December 2025 was 9.5% (28 December 2024: 10.0%); and
• Cash flows are forecast up to the probable end date of the lease. Where
considered appropriate, based on the estimated useful lives of fixtures and
fittings within the CGU, cash flows may be included for periods beyond the
lease probable end date (to a maximum of five years in total).
On the basis of these assumptions, a net impairment charge of £6.9 million
has been recognised during the current year (2024: £5.0 million), of which
£3.9 million relates to fixtures and fittings and £3.0 million relates to
right-of-use assets. The total impairment provision as at 27 December 2025 is
£13.9 million (2024: £9.5 million) in respect of 167 shops (2024: 109
shops), of which £7.0 million relates to fixtures and fittings and £6.9
million relates to right-of-use assets.
Change in Accounting Estimate
During 2025 the value-in-use calculations have been updated to reflect the
latest assessment of overhead allocations alongside updating the other inputs
detailed above. The revised approach to allocating overheads (retail, supply
chain and corporate overheads) between individual shop CGUs and the group of
CGUs better aligns to the Group's assessment of central overheads, reflecting
on the ongoing investment in the central estate, a growing
business-to-business segment, overheads incurred in respect of growing the
company-managed estate and overheads related to exploring other growth
opportunities. If the previous method of allocating overheads had been applied
to the value-in-use calculations for 2025, the impairment charge in 2025 would
be higher by £8.9 million; however the approach taken in 2025 is considered a
more appropriate basis for the reasons outlined above. If the 2025
methodology for overhead allocation had been applied to the prior year
value-in-use calculations, whilst leaving all other inputs to the calculations
unchanged, the impact on the 2024 impairment charge would have been
immaterial.
Given the uncertainties in the impairment model, the sensitivities of these
assumptions on the impairment calculation have been tested:
• A 1% increase in the discount rate would result in an increased
impairment of £1.0 million, with an additional three shops impaired. A 1%
decrease in the discount rate would result in a reduced impairment of £1.0
million, with six fewer shops impaired.
• A 5% increase in the year one like-for-like assumption would result
in a reduced impairment of £4.7 million with 35 fewer shops impaired. A 5%
decrease in the year one like-for-like assumption would result in an increased
provision of £6.5 million with an additional 37 shops impaired.
Determining the rate used to discount property lease payments (judgement)
At the commencement date of property leases the lease liability is calculated
by discounting the lease payments. The discount rate used should be the
interest rate implicit in the lease. However, if that rate cannot be readily
determined, which is generally the case for property leases, the lessee's
incremental borrowing rate is used, being the rate that the individual lessee
would have to pay to borrow the funds necessary to obtain an asset of similar
value to the right-of-use asset in a similar economic environment with similar
terms, security and conditions. As the Group had no suitable external
borrowings from which to determine that rate, judgement is required to
determine the incremental borrowing rate to be used. Given the volume of lease
events and for simplicity, at the start of each month a risk-free rate is
obtained, linked to the length of the lease and an adjustment is then made to
reflect credit risk. This rate is applied to new leases and modifications
arising in that month. During the year discount rates in the range 5.2% to
6.3% (2024: 5.1% to 6.1%) were used. Small changes in the discount rate would
have an immaterial impact on the accounts. A 0.1% change in the discount rate
used for each lease is estimated to adjust the total liabilities by circa
£2.3 million.
Determining the lease term of property leases (judgement)
At the commencement date of property leases, and based on previous experience,
the Group normally determines the lease term to be the full term of the lease,
assuming that any option to break or extend the lease is unlikely to be
exercised and it is not reasonably certain that the Group will continue in
occupation for any period beyond the lease term. Leases are regularly reviewed
and will be revalued if it becomes reasonably certain, as a result of trading
performance and/or further investment in the property, that a break clause or
option to extend the lease will be exercised.
The leases typically run for a period of 10 or 15 years. In England and Wales,
the majority of the Group's property leases are protected by the Landlord and
Tenant Act 1954 (LTA) which affords protection to the lessee at the end of an
existing lease term.
Judgement is required in respect of those property leases where the current
lease term has expired but the Group has not yet renewed the lease. Where the
Group believes renewal to be reasonably certain and the lease is protected by
the LTA it will be treated as having been renewed at the date of termination
of the previous lease term and on the same terms as the previous lease. Where
renewal is not considered to be reasonably certain the leases are included
with a lease term which reflects the anticipated notice period under relevant
legislation. The lease will be revalued when it is renewed to take account of
the new terms. As at 27 December 2025 the financial effect of applying this
judgement was an increase in recognised lease liabilities of £37.5 million
(28 December 2024: £27.0 million).
Post-retirement benefits - defined benefit obligation (estimation)
The determination of the defined benefit obligation of the Group's defined
benefit pension scheme depends on the selection of certain assumptions with
significant estimation uncertainty including the discount rate, inflation
rate, mortality rates and commutation. Differences arising from actual
experience or future changes in assumptions will be reflected in future years.
2. Segmental analysis
The Executive Directors are considered to be the 'chief operating decision
maker' of the Group in the context of the IFRS 8 definition. In addition to
its company-managed retail activities, the Group generates revenues from its
business-to-business channel which includes franchise and wholesale
activities. Both channels were categorised as reportable segments for the
purposes of IFRS 8.
Company-managed retail activities - the Group sells a consistent range of
fresh bakery goods, sandwiches and drinks in its own shops or via delivery.
Sales are made to the general public on a cash basis. All results arise in the
UK.
Business-to-business channel - the Group sells products to franchise and
wholesale partners for sale in their own outlets as well as charging a licence
fee to franchise partners. These sales and fees are invoiced to the partners
on a credit basis. All results arise in the UK.
All revenue in 2025 and 2024 was recognised at a point in time.
The Executive Directors regularly review the revenues and trading profit of
each segment. They receive information on overheads, assets and liabilities on
an aggregated basis consistent with the Group accounts.
2025 2025 2025 2024 2024 2024
Retail Business to business Total Retail Business to business Total
company-managed company-managed
shops shops
£m £m £m £m £m £m
Revenue 1,897.2 254.0 2,151.2 1,781.7 232.7 2,014.4
Cost of sales (581.6) (135.0) (716.6) (533.0) (127.0) (660.0)
======= ======= ======== ======= ======= ========
Gross profit 1,315.6 119.0 1,434.6 1,248.7 105.7 1,354.4
Supply costs (203.1) (50.3) (253.4) (191.4) (48.5) (239.9)
Retail costs (861.1) (2.2) (863.3) (780.0) (1.7) (781.7)
======= ======= ======== ======= ======= ========
Trading profit 251.4 66.5 317.9 277.3 55.5 332.8
Overheads including profit share (146.8) (150.4)
Add back lease interest 16.4 12.9
________ ________
Operating profit before exceptional items 187.5 195.3
Finance income 1.8 8.1
Finance expense (17.4) (13.6)
________ ________
Profit before tax (excluding exceptional items) 171.9 189.8
Exceptional items (see note 3) (4.5) 14.1
_______ _______
Profit before tax 167.4 203.9
======= =======
3. Exceptional items
The exceptional items are as follows:
2025 2024
£m £m
Redundancy / dilapidations provisions no longer required - 0.3
Profit on disposal of Twickenham bakery site (net of fees) - 13.8
Prior year VAT underpayment (4.5) -
_______ _______
(4.5) 14.1
======= =======
4. Taxation
Recognised in the income statement
2025 2025 2025 2024 2024 2024
Excluding exceptional items Exceptional items Total Excluding exceptional items Exceptional items Total
(see note 3) (see note 3)
£m £m £m £m £m £m
Current tax
Current year 27.3 (0.9) 26.4 26.3 - 26.3
Adjustment for prior years (1.6) - (1.6) 7.1 - 7.1
________ ________ ________ ________ ________ ________
25.7 (0.9) 24.8 33.4 - 33.4
________ ________ ________ ________ ________ ________
Deferred tax
Origination and reversal of temporary differences 18.9 - 18.9 22.3 1.7 24.0
Adjustment for prior years 1.5 - 1.5 (6.9) - (6.9)
________ ________ ________ ________ ________ ________
20.4 - 20.4 15.4 1.7 17.1
________ ________ ________ ________ ________ ________
Total income tax expense in income statement
46.1 (0.9) 45.2 48.8 1.7 50.5
======= ======= ======= ======= ======= =======
5. Earnings per share
Basic earnings per share
Basic earnings per share for the 52 weeks ended 27 December 2025 is calculated
by dividing profit attributable to ordinary shareholders by the weighted
average number of ordinary shares in issue during the 52 weeks ended 27
December 2025 as calculated below.
Diluted earnings per share
Diluted earnings per share for the 52 weeks ended 27 December 2025 is
calculated by dividing profit attributable to ordinary shareholders by the
weighted average number of ordinary shares, adjusted for the effects of all
dilutive potential ordinary shares (which comprise share options granted to
employees) in issue during the 52 weeks ended 27 December 2025 as calculated
below.
Profit attributable to ordinary shareholders
2025 2025 2025 2024 2024 2024
Excluding exceptional items Exceptional items (see note 3) Total Excluding exceptional items Exceptional items (see note 3) Total
£m £m £m £m £m £m
Profit for the financial year attributable to equity holders of the Parent 125.8 (3.6) 122.2 141.0 12.4 153.4
======= ======= ======= ======= ======= =======
Basic earnings per share 123.5p (3.5p) 120.0p 138.5p 12.2p 150.7p
Diluted earnings per share 122.8p (3.5p) 119.3p 137.5p 12.1p 149.6p
Weighted average number of ordinary shares
2025 2024
Number Number
Issued ordinary shares at start of year 102,255,675 102,255,675
Effect of own shares held (366,219) (480,247)
__________ __________
Weighted average number of ordinary shares during the year 101,889,456 101,775,428
Effect of share options in issue 593,439 782,816
__________ __________
Weighted average number of ordinary shares (diluted) during the year 102,482,895 102,558,244
========= =========
6. Dividends
The following tables analyse dividends when paid and the year to which they
relate:
2025 2024
Per share Per share
pence pence
2023 final dividend - 46.0p
2023 special dividend - 40.0p
2024 interim dividend - 19.0p
2024 final dividend 50.0p -
2025 interim dividend 19.0p -
________ ________
69.0p 105.0p
======= =======
The proposed final dividend in respect of 2025 amounts to 50.0 pence (£50.9
million). This dividend is not included as a liability in these accounts.
2025 2024
£m £m
2023 final dividend - 46.8
2023 special dividend - 40.7
2024 interim dividend - 19.3
2024 final dividend 50.9 -
2025 interim dividend 19.4 -
________ ________
70.3 106.8
======= =======
7. Related parties
The Group has a related party relationship with its subsidiaries, associates,
Directors and executive officers and pension schemes.
There have been no related party transactions in the year which have
materially affected the financial position or performance of the Group.
8. Principal risks and uncertainties
Effective risk management is a key part of our strategic thinking and supports
our business operations in the delivery of our objectives. Having a robust
risk management process in place also helps the Board to comply with its
obligations as set out in the UK Corporate Governance Code 2024.
Risk management and internal control
Risk management is a key step in our business processes, supporting our
decision making and the delivery of our strategy. Risks cannot be avoided,
but good risk management ensures that they are mitigated to an acceptable
level, in line with our agreed risk appetite. Managing our risks helps us to
protect our colleagues, our customers and our reputation.
Roles & responsibilities
The various roles within the risk management process are set out below:
Role Responsibilities
Direction & Main Board · Confirms the effectiveness of our material controls in line with
UK Corporate Governance Code 2024 requirements.
Oversight
· Ultimately accountable for ensuring that
risks are identified and appropriately managed.
· Approves the risk appetite and other policies.
· Provides oversight and assurance for risk management.
· Ensures an appropriate risk culture is embedded through the
"tone at the top".
Audit Committee · Monitors the Greggs' risk management and internal control
approach and undertakes a review of its effectiveness on behalf of the Main
Board.
· Challenges the Principal Risk disclosure.
Ownership & Monitoring Risk Committee · Undertakes proactive risk management reviews and ensures risk
mitigation measures are put in place to manage significant risks
appropriately.
· Reviews current risks and controls and the need
for additional actions.
· Agrees and monitors actions to mitigate risks.
· Discusses new and emerging risks.
· Makes decisions on business cases for additional risk treatment
options.
Operating Board · Owns and manages significant risks, which are reviewed and
validated bi-annually.
· Escalates any functional risks.
· Identifies risks which may prevent the achievement of objectives.
Day to day risk management Risk & Process Owners · Responsible for managing any assigned risks. This will include:
o ensuring that risks are assessed on a regular basis and remain within
Greggs' risk appetite.
o putting in place adequate levels of controls.
o enhancing controls where required.
· Ensures compliance with policies and procedures.
Assurance Risk Management · Responsible for the overall Risk Management Framework and
proposing amendments / developments to the Risk Committee.
team
· Manages the corporate risk register.
· Provides support to Greggs' business areas and individual risk
owners to enable them to effectively manage risks.
· Reviews information provided by the risk owners.
Independent overview Internal Audit team · Provides independent assurance on the effectiveness of risk
management and internal controls.
· Challenges current risk management practices to confirm their
adequacy.
Our risk management approach
Our core risk management process remains consistent with prior years - this is
now well established and embedded. There have been no significant changes,
though we do continue to develop and improve our framework.
Identify: Risks are identified from both "top-down" and "bottom-up" by the
groups set out above. We hold workshops with the relevant teams to record
and update risks at a functional level. More significant risks are recorded
in our strategic risk register and are the responsibility of the Risk
Committee. New and emerging risks are considered at least quarterly.
Assess: We describe each risk in our registers and allocate an owner. We
record the key controls for each risk and assess their effectiveness. The
likelihood and impact of each risk arising is then determined, both before and
after the introduction of mitigating controls. Each of our functional heads
is responsible for their own risk register, which is produced in a manner
consistent with the strategic register. Functional risk registers are
reviewed at least twice per year.
Respond: Each risk owner is responsible for ensuring that appropriate
mitigating controls remain in place, as well as identifying actions to further
mitigate risk where necessary (for example if the risk is outside our appetite
level).
Monitor & report: The Risk Committee (all members of our Operating Board
plus key heads of business functions) meets at least quarterly. We conduct a
formal review of our key strategic risks at least twice a year, with input and
update from each of the risk owners. Our business assurance team provide
support to the process and also provide an independent opinion on the
effectiveness of controls within the internal audit programme. An update on
the risk process is provided to each Audit Committee meeting, with an annual
update to the Main Board.
Developments in 2025
The Risk Committee has met four times during the year. The focus of meetings
outside standing agenda items has been on material controls and contingency
plans for business-critical activities. We have continued to include break-out
sessions within each meeting where possible, to allow an opportunity for
debate and discussion.
Our one page "risk dashboard" developed last year remains a key part of our
risk communication process. As well as providing a monthly summary of key
issues to the Operating Board, the content is now also shared with the Heads
of Function via our SharePoint site and presented to the Main Board via the
Company Secretary's report.
Having conducted an externally facilitated fraud risk review last year, the
output is now reviewed by the relevant risk owners in line with all other
risks. However, we also considered broader fraud risk as the breakout topic in
our October Risk Committee meeting. Existing fraud risks were considered by
the Committee, to identify any omissions. As a result, an additional fraud
risk workshop looking at international expansion was held, and the output
documented. Our fraud risk assessment policy and procedure do not require a
formal review until January 2027, having only been documented during 2025.
As we started to identify opportunities within our climate risk discussions,
we considered whether this should be incorporated within our standard risk
approach as good practice. A small working group was set up to consider the
approach and agreed that at present it was appropriate to restrict the
recording of opportunities to climate risks. We will consider a wider
rollout in time, if there is a demonstrable benefit to doing so.
Our Enterprise Risk Management (ERM) policy and procedure have been reviewed
and updated to reflect the above changes. Both documents have been reviewed
and approved by the Risk Committee at its January meeting, in line with our
normal governance process.
Although we continue to refine our methodology, we are confident that the
process in place during 2025 was sufficiently robust to ensure that our risks
were being appropriately managed.
Having defined our risk appetite for the first time in 2024, we have made
changes to our methodology in 2025, to make the model a better fit to the
business. Our original appetite was measured on a 5-point scale.
However, this proved to be inconsistent with how the ERM framework operates in
practice. Following further consultation, we have agreed a change to a 3-point
scale. We have also amended our risk assessment heat map to a 3-point scale
for consistency.
We have maintained a "low" overall risk appetite, driven by a strong
commitment to safety, compliance and long-term sustainability. Although we
allocated a separate risk appetite to each of our risk types, a rating of
"low" was agreed for all ten.
Material controls
Identifying and documenting our material risks and associated controls has
been a key area of focus for us this year, and this has been included on the
agenda at all our Risk Committee and Audit Committee meetings.
For each material control, we have identified and documented our assurance
sources, along with relevant evidence of the control being operational. Our
Business Assurance team has then audited the stated sources of evidence to
assess compliance at the end of 2025. The Audit Committee has confirmed that
it is satisfied with the level of assurance provided.
Our Audit Committee will receive bi-annual updates on our material controls
during 2026. This will ensure that our Board is able to comply with the
requirements of the UK Corporate Governance Code 2024 at the end of the
current financial year, and confirm the effectiveness of the material
controls.
Climate risks
Our climate related risks are integrated within our risk management process
and are captured within our strategic and functional registers. Our
Sustainability Reporting Steering Group has responsibility for ensuring that
risks and opportunities are considered and recorded in a consistent way.
We remain of the view that our strategic risk of "a failure to effectively
respond to climate related impacts on our business" does not constitute a
principal risk within the time horizon of our current plans.
Emerging risks
We formally review and discuss any emerging risks as part of our quarterly
Risk Committee's rolling agenda. Many of these risks are identified during
ongoing discussions across the business. This helps to anticipate and
prepare for any changes.
Various sources of information are used to ensure this is as complete as
possible, including:
· Horizon scanning by subject matter experts throughout the business,
with issues identified being recorded in our monthly risk dashboard for
consideration by Operating Board;
· Engaging with senior colleagues in the business to discuss any areas
of concern within their remit;
· Monitoring customer and consumer trends both internally and
externally;
· Taking input from our advisors and other specialists with whom we
work.
Examples of emerging and escalating risks identified during the year include
IT outages (including those suffered by our key suppliers), geopolitical
impacts, increasing use of Artificial Intelligence and economic conditions.
Emerging risks continue to be reported to the Main Board each quarter.
Changes to principal risk disclosures
A principal risk is one which can seriously affect our performance, future
prospects or reputation, taking into account the potential impact and
likelihood of occurrence. Not all of our strategic risks are considered to be
principal risks, only those which would have a significant impact on our
ongoing viability within the timeframe of our strategic plan. Principal
risks are discussed and monitored at least quarterly, through the mechanisms
set out above.
Following the definition of our material risks (as described above), we have
reflected on our principal risk disclosure, and agreed that we should include
a financial risk relating to liquidity. This is based upon a potential
inability to access the necessary liquidity facilities to support the deliver
of our strategic plans.
The risk relating to internal business interruption has decreased, as we
consider the impact of any such issue has been reduced by our mitigating
actions. We recognise that the overall level of cyber risk in the market has
increased, although we continue to take significant steps to improve our
controls and strengthen our resilience. All other principal risks remain
unchanged in their assessed level of net risk.
The following table sets out the principal risks, shows the movement during
the year, and describes the impact and key mitigations. The list is not in
priority order, and does not include all the risks which we face. Other
risks which are not included here could also have a negative impact on the
business, including those which are not presently known to us and those which
are considered less material. The position described below is a summary at
the time of publishing this report.
Principal risks and uncertainties
Risk & description Impact Key mitigations Links to strategy Movement
Business interruption event - product availability
We could suffer a significant reduction in product availability as a result of We would potentially be unable to supply our customers with our full range of We have contingency plans in place for our sites, which are reviewed and 1,2,3 Decrease
the total loss of capacity at a key production facility. products for a period of time. This would primarily impact our own tested periodically. Key product lines are prioritised in the event of any
customers, including those of our franchise partners, but also potentially our issues. 4,5
wholesale sales.
Category: Operational
We are continuing to roll out a standardised Business Continuity Management
approach across our supply sites.
Our diversified product range provides alternatives for our customers in the
event of items being unavailable.
Flexibility and spare capacity within our network enables us to continue our
operations at other sites. We also monitor surplus capacity across the
market.
We liaise regularly with insurers and our broker, particularly when designing
new sites or improving existing premises. This ensures that our facilities
meet the expected standards.
Risk & description Impact Key mitigations Links to strategy Movement
Supply chain disruption
Supply from a key third party could be interrupted. This could be a result A prolonged outage or other significant issue at one of our key suppliers or We avoid single source supply for key ingredients as far as possible, with 1,2,3 No change
of issues such as external business interruption, geopolitical instability, or within their supply chain could impact on our ability to produce some of our risk mitigations plans in place where necessary.
a food safety concern. range, or otherwise affect our ability to operate.
4,5
Stock holdings of ingredients and key equipment provides contingency in the
event of an interruption to supply.
Category: Food Safety / Strategic
If we suffer any significant interruptions, we are quick and agile in our
response to find alternatives. These processes are regularly tested by our
teams.
Relationships with suppliers are managed centrally by our Procurement teams,
including a risk assessment process. Governance processes and supplier
audits confirm compliance with our standards.
Risk & description Impact Key mitigations Links to strategy Movement
Cyber & data security incident
Our IT infrastructure may be affected by a cyber incident, resulting in a data We could suffer a significant loss of data, resulting in litigation and fines. We work with third parties who provide expertise and support, ensuring that
breach, or the confidentiality / integrity of our data being impacted.
our controls are appropriate. This includes a Security Operations Centre
Data may be unavailable or lost, making it difficult for us to operate. monitoring our networks around the clock, along with regular penetration 2,3,4 No change
testing.
Category: Information Security
Our technical measures are constantly reviewed and updated in line with
changing requirements and recognised information security control sets. This
is confirmed by various external assessments.
We train and test our colleagues to improve awareness and strengthen our
detection and prevention, including phishing simulations.
Prolonged system downtime/ interruption
Our reliance on technology means that system interruptions and cyber incidents IT products and services which are needed to support our operations We work with external partners to ensure we have access to specialist support
are potentially more disruptive, with a more significant impact on business business-critical activities may be lost for a prolonged period. This could and expertise.
operations. lead to extended business disruption.
2,3,4 Increase
We monitor the external environment, taking learnings from other organisations
Category: Operational and enhancing our controls and response accordingly.
We continue to move towards more cloud-based solutions across our operations,
which increases resilience within our network.
We have identified our most critical business activities and have an ongoing
programme which continually improves our business continuity and disaster
recovery capability.
Risk & description Impact Key mitigations Links to strategy Movement
Deterioration of relationship with key partner
Our strategy and goals may not be fully aligned with those of our partners in This would limit our ability to offer our service in locations where our We work with a number of respected partners, avoiding undue reliance on any
franchise, grocery retail or delivery. customers want us to be. one individual organisation.
1,2,3 No change
4
Category: Strategic Performance could be affected, with targets not being met. Contracts and service level agreements are in place. Ongoing performance is
measured and robust action taken promptly if our standards are not met.
This in turn could damage our brand reputation.
Regular dialogue at a senior level ensures an alignment of goals, and early
identification of any issues.
Risk & description Impact Key mitigations Links to strategy Movement
Ability to attract / retain / motivate people
We may be unable to attract and retain the right talent within Greggs to We may be unable to continue to deliver our existing product range and service We recognise that our people are a key asset to the business. We offer
maintain our culture and operate as our customers expect. standards. competitive packages, comprehensive training and development opportunities, as
well as additional benefits. 1,2,3 No change
Higher staff turnover creates a need for additional recruitment, in turn
increasing workload and training requirements. 4,5
Category: Operational
Ultimately, we may be unable to grow the business in line with our strategy. Colleagues have a range of ways to communicate their ideas for improvement,
including our annual opinion survey and listening groups. This helps to
maintain positive relations and an open culture.
Efficient recruitment processes leveraging technology allow us to fill
vacancies quickly and effectively.
Risk & description Impact Key mitigations Links to strategy Movement
Damage to reputation
There is greater risk of damage to our reputation by internal or external Customers could lose their trust in the brand, impacting on our ability to Policies and guiding principles are in place to control our use of the brand.
sources as our brand profile grows. deliver our strategy.
2,3 No change
Our colleagues are given training, advice and guidance on dealing with
Category: Reputational Shareholder value could be reduced. customers and other contacts.
We have a robust well-established crisis management process in place, which we
test regularly. This is supported by appropriate third parties (such as PR
agencies, insurers etc) where specialist advice is required.
Risk & description Impact Key mitigations Links to strategy Movement
Significant Food Safety incident / product quality issue
We may produce and/or sell products which are unsafe, or not of the There could be harm to our customers or colleagues. External suppliers of products with a food safety risk must comply with our
appropriate quality. This could be a result of incorrect labelling of
manufacturing standard
allergens, product contamination, or a failure to comply with procedures.
1,2,3,4,5 No change
Our brand reputation could be significantly impacted, which in turn would
affect our sales performance. We could also be exposed to significant fines. Robust Food Safety management systems and policies are in place, independently
Category: Food Safety
assured by our Primary Authority.
Our teams are trained in accordance with our policies, across all levels of
the business.
Audits are undertaken by our internal teams, and external bodies, with a focus
on Food Safety compliance. These cover both production and retail
processes. Our manufacturing sites are independently accredited by a third
party.
Allergen guides are available to our customers.
Changes in the regulatory landscape
New regulatory requirements could be implemented, driven by environmental, We may need to take action such as introducing new products to our range, or Our teams undertake regular horizon scanning activities, and we receive
health or other concerns. changing our approach to advertising or promotions. Without an ability to advisory information across all professional disciplines.
respond quickly, we could lose market share, or face regulatory action.
1, 2, 3, 4
No change
Category: Governance, Legal & Regulatory We put appropriate policies and procedures in place to manage key risk areas.
We monitor upcoming legislative changes through Trade Associations and
government bodies.
Participating in industry forums gives us an opportunity to influence decision
making.
Risk & description Impact Key mitigations Links to strategy Movement
Financial liquidity
The business may not be able to access the liquidity facilities required to Investment plans may have to be delayed in order to prioritise our financial We have discretion over our uncommitted investment plans and can reduce
deliver on its plans. commitments to our employees, suppliers and property providers. capital expenditure in the short term to improve liquidity.
1, 2, 3, 4 New
Category: Financial Credit customers are vetted before being approved and then their payment
performance is regularly monitored to ensure compliance with agreed terms.
A committed Revolving Credit Facility is in place, with significant undrawn
capacity.
Treasury policies control access to finance and security limits for cash
deposits.
Reporting and approval controls provide management and the Board with
visibility of the current financial position of the business and its
medium-term liquidity expectations.
"Links to strategy" key:
1 Great tasting, freshly prepared food, 2 Best customer experience, 3
Competitive supply chain, 4 First class support teams, 5 The Greggs Pledge
9. Alternative Performance Measures
In monitoring and assessing the Group's performance, the Directors use a
number of Alternative Performance Measures (APMs) which are not defined by
IFRS. These measures provide additional insight into the underlying
performance of the business by excluding items that are material and / or
unusual in nature or non‑recurring, and which could otherwise distort
period‑on‑period comparisons. APMs should be considered alongside the IFRS
measures and may not be directly comparable with those used by other
companies.
Like-for-like (LFL) sales growth - compares year-on-year cash sales in our
company-managed shops, with more than one calendar year's trading history and
is calculated as follows:
2025 2024
£m £m
Current year LFL sales 1,679.0 1,564.0
Prior year LFL sales 1,639.7 1,483.1
________ ________
Growth in LFL sales 39.3 80.9
======== ========
LFL sales growth percentage 2.4% 5.5%
Like-for-like sales can be reconciled to total revenue as follows:
2025 2024
£m £m
LFL sales in company-managed shops 1,679.0 1,564.0
Non-LFL sales in company-managed shops 218.2 217.7
Total revenue in retail company-managed shops 1,897.2 1,781.7
Business to business sales 254.0 232.7
Total revenue 2,151.2 2,014.4
Franchise like-for-like ('FLFL') system sales growth - compares year-on-year
cash sales in our franchised shops, with more than one calendar year's trading
history and is calculated as follows:
2025 2024
£m £m
Current year FLFL sales 325.6 280.1
Prior year FLFL sales 312.2 260.8
Growth in FLFL sales 13.4 19.3
FLFL sales growth percentage 4.3% 7.4%
Franchise system sales are different from revenue. They are the sales made in
our franchised shops whereas the Company's revenue from business-to-business
sales comprises sales of products to franchise and wholesale partners together
with the licence fee charged to franchise partners.
Return on capital employed - calculated by dividing profit before tax by the
average total assets less current liabilities for the year
2025 2025 2024 2024
Underlying Including exceptional items Underlying Including exceptional items
(see note 3) (see note 3)
£m £m £m £m
Profit before tax 171.9 167.4 189.8 203.9
======= ======= ======= =======
Capital employed:
Opening 1,009.5 1,009.5 857.2 857.2
Closing 1,136.3 1,136.3 1,009.5 1,009.5
------------- ------------- ------------- -------------
Average 1,072.9 1,072.9 933.4 933.4
======= ======= ======= =======
Return on capital employed 16.0% 15.6% 20.3% 21.8%
Net cash inflow from operating activities after lease payments - calculated by
deducting the repayment of principal of lease liabilities from net cash flow
from operating activities
2025 2024
(Restated)
£m £m
Net cash inflow from operating activities 337.0 318.6
Repayment of principal of lease liabilities (63.3) (56.7)
------------- -------------
Net cash inflow from operating activities after lease payments 273.7 261.9
======= =======
Diluted operating cash inflow per share - calculated as net cash inflow from
operating activities after lease payments (see above) divided by the diluted
weighted average number of ordinary shares during the year
2025 2024
Net cash inflow from operating activities after lease payments £273.7m
£261.9m
Weighted average number of ordinary shares (diluted) during the year 102,482,895
102,558,244
------------- -------------
Diluted operating cash inflow per share 267.1p 255.4p
======= =======
Net cash and cash equivalents- calculated by deducting borrowings from cash
and cash equivalents
2025 2024
£m £m
Cash and cash equivalents 70.8 125.3
Borrowings (25.0) -
------------- -------------
Net cash and cash equivalents 45.8 125.3
======= =======
Liquidity - calculated by adding cash and cash equivalents to the undrawn
amount of the RCF facility
2025 2024
£m £m
Cash and cash equivalents 70.8 125.3
Undrawn RCF 75.0 100.0
------------- -------------
Total liquidity 145.8 225.3
======= =======
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