Bakery Greggs has enjoyed strong sales over the Christmas period. Like-for-like own shop sales climbed 8.2 per cent, after it put the "food-on-the-go" customer at the centre of its focus over the holiday season.
For the financial year, total sales grew 5.5 per cent, with like-for-like sales up 4.5 per cent. The company's estate improvement programme resulted in 213 shop refurbishments. As of 3 January 1,650 shops were trading. Greggs added that it now expects to report full year results above expectations.
Why it's interesting
The bakery chain performed well throughout the recession but encountered some difficulties back in 2013. However, it bounced back, reporting like-for-like sales up 5.2 per cent for the 24 weeks to December 2013.
Fast forward a year, and the company's bullish, believing conditions for the first half of 2015 are encouraging, with low-input cost inflation expected (aka "stuff is getting cheaper"), combined with an improved outlook for disposable incomes. The company is widely seen as a good guide for consumer sentiment. If this is correct consumers are certainly on the more optimistic side.
What Greggs said
Greggs chief executive Roger Whiteside said:
Since our last update on 15 December we have experienced a very strong level of trade through the Christmas and New Year period. Customers have clearly responded to the improvements in our product offer and service, designed to meet the needs of the food-on-the-go consumer, during this busy period.
This has been a year in which we have made good progress with our strategic plans and seen a welcome improvement in financial performance. We remain clear on our priorities and are confident that we can make further progress in the year ahead.
Greggs is performing well and may perform even better than expected when it reports its full-year financial results. A good performance from Greggs could be another indicator that consumer sentiment is on the up.