Greggs share price soars as profits leap and dividend rises

Catherine Neilan
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Greggs' gamble to diversify away from pasties is paying off (Source: Getty)
Greggs' share price jumped nearly six per cent this morning after its first half results showed the business is on a (sausage) roll.

The figures

The retailer had a strong first half, with sales up 6.4 per cent to £398m and pre-tax profits leaping 51 per cent to £25.6m.
The baked goods business is offering a dividend of 7.4p per share, up from 6p last year. This is on top of a special dividend of 20p, which was paid out on 17 July.
Own shop like-for-likes were up 5.9 per cent

Why it's interesting

Last year's restructuring of the business is really starting to pay off. Greggs said that alone contributed £2.4m year-on-year.
Its focus on the healthier options – its “Balanced Choice” range – is also reaping rewards, and the shop refit is “progressing well”, tempting more customers in for pasties and sandwiches.
The busines – which not too long ago was worrying over the threat of the so-called pasty tax – has also returned to net shop growth, opening 44 new shops in the period, while closing 30 stores.

What they said

Chief executive Roger Whiteside said: “We have had a strong first half with good growth in sales reflecting improvements in our products and the reaction to our shop investment programme. Our offer of great tasting food-on-the-go is being well received by the consumer in market conditions that have remained favourable.
“In particular we have seen significant growth in breakfast sales as well as from the extension of our "Balanced Choice" range of sandwiches and flatbreads with fewer than 400 calories.
"With the shop refurbishment programme continuing to progress well and new additions to the product range including pizza slices, we are confident of delivering a year of good growth slightly ahead of our previous expectations."

In short

Greggs is looking pretty tasty right now.

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