Robust financial position for Greggs to support growth plans

Food-on-the-go retailer, Greggs, with around 2,300 retail outlets throughout the country has reported a strong fourth quarter ending a year of encouraging strategic progress.

Highlights include:
• Financial year 2022 total sales up 23.0% to £1,513m (2021: £1,230m)
• LFL sales for fourth quarter up 18.2%
• LFLsales 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

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.”

>b>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 the iconic Festive Bake, which featured alongside its vegan-friendly alternative, shop-baked Sweet Mince Pies and festive hot drinks including the Salted Caramel Latte. Plant-based foods are contributing more significantly to the 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, Greggs has seen strong growth in use of its 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, Greggs 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 its partners. 500 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 £191m, partly reflecting phasing of capex investment. This will support plans to invest further in growing both the shop estate and supply chain capacity in the year ahead. The pipeline of new shop opportunities remains strong and Greggs expects to open around 150 net new stores again in 2023.