REG - Greggs PLC - Q4 Trading Update

GreggsAnnouncement

05/01/2023 07:00

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RNS Number : 7180L  Greggs PLC  05 January 2023

 

 

5 January 2023

 

GREGGS plc

FOURTH QUARTER TRADING UPDATE

 

Greggs is a leading UK food-on-the-go retailer,

with around 2,300 retail outlets throughout the country

 

Strong quarter ends a year of encouraging strategic progress

Robust financial position supports growth plans

 

·    Financial year 2022* ("FY22") total sales up 23.0% to £1,513m (2021:
£1,230m)

·    LFL sales** for fourth quarter up 18.2%

·    LFL** sales for FY22 up 17.8%

·    186 new shops opened in the year, 39 closures

·    2,328 shops trading as at 31 December 2022

·    Strong growth in digital and early evening sales

·    Robust cash position to support investment in growth plans

·    Anticipate full year outcome in line with our previous expectations

 

* 52 weeks ended 31 December 2022 (2021: 52 weeks ended 1 January 2022)

** Like-for-like (LFL) company-managed shop sales performance against
comparable period in 2021

 

 

 

Roisin Currie, Chief Executive commented:

 

"I am proud of the progress Greggs made during 2022 in challenging
conditions.  Our teams did a magnificent job serving customers and managing
the growing demand for Greggs products as we expand our shop estate and offer
greater availability through digital channels and longer trading hours, whilst
continuing to extend our menu to offer more choice.

 

"We enter 2023 in a strong financial position that will enable us to invest in
shops and supply chain capacity to bring Greggs to even more customers across
the UK.  While market conditions in 2023 will remain challenging, our
value-for-money offer of freshly-prepared food and drink is highly relevant as
consumers look to manage their budgets without compromising on quality and
taste."

 

 

Trading update

 

Sales for FY22 were £1,513 million, an increase of 23.0% compared with the
equivalent period in 2021.  Like-for-like sales in company-managed shops were
17.8% higher than sales seen in 2021.

 

Despite the impact of adverse weather and strikes at the end of 2022, fourth
quarter like-for-like sales in company-managed shops grew by 18.2%.  This
reflected a favourable trading pattern leading into the Christmas period and
softer trading conditions in the comparable quarter of 2021 as a result of
disruption caused by the omicron variant of coronavirus.

 

Seasonal lines were in high demand in the fourth quarter, including our iconic
Festive Bake, which featured alongside its vegan-friendly alternative, our
shop-baked Sweet Mince Pies and our festive hot drinks including the Salted
Caramel Latte.  Plant-based foods are contributing more significantly to our
range over time and the introduction of new hot options such as the Vegan
Festive Baguette is testament to this trend.

 

At a time when consumers are increasingly focused on value, we have seen
strong growth in use of the Greggs App.  This rewards customers for their
loyalty with free products across our entire range, as well as giving access
to features such as Click + Collect, nutritional information and delivery
options.

 

During the year we opened 186 new shops (including 70 franchised units) and
closed 39, growing the estate to 2,328 shops as at 31 December 2022, 441 of
which are franchised shops operated by our partners.  500 of our shops are
now open until 8pm and early-evening is now the fastest growing daypart as we
extend availability to both walk-in and delivery customers.

 

Financial position and outlook

 

Greggs ended 2022 with a cash position of £191 million, partly reflecting
phasing of capex investment, which we have previously described.  This will
support our plans to invest further in growing both our shop estate and supply
chain capacity in the year ahead.  The pipeline of new shop opportunities
remains strong and we expect to open around 150 net new stores again in 2023.

 

Given our strong trading in the year, together with careful cost control, we
anticipate reporting a full year outcome for FY22 in line with our previous
expectations when we report our preliminary results for 2022 on 7 March 2023.

 

We continue to see material cost inflation in the year ahead.  However,
whilst consumers are clearly seeing pressures, our value offering remains
attractive in the food-on-the-go market.  We are confident in delivering
another year of good progress in 2023 and remain excited by the significant
growth opportunity for Greggs in the years ahead.

 

 

 

 

 ENQUIRIES:
 Greggs plc                         Hudson Sandler
 Roisin Currie, Chief Executive     Wendy Baker / Nick Moore

 Richard Hutton, Finance Director   Sophie Miles / Emily Brooker

 Tel:      0191 281 7721            Tel:      020 7796 4133

                                    Email: greggs@hudsonsandler.com

 

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