Greggs has upgraded its profit expectations for the year after the bakery chain reported boosted sales for its latest period.
Total sales were up 12.4 per cent in the six weeks to 9 November while like-for-like sales in company-managed shops increased 8.3 per cent.
In a trading update this morning Greggs, which has 2,000 stores across the UK, said it now anticipates 2019 full-year profit before tax, excluding exceptional charges, to be higher than previous expectations.
Greggs’ share price jumped 8.9 per cent in early trading to 1,929p.
“Sales growth continues to be driven by increased customer visits and has been stronger than we had expected given the improving comparative sales pattern that we saw in the fourth quarter last year,” the company said in a statement today.
“Operational costs remain well controlled and, whilst the comparative sales become stronger still in the balance of the year, the board now anticipates that full year underlying profit before tax (excluding exceptional charges) will be higher than our previous expectations.”
Retail analyst Nick Bubb said: “Weak footfall may be a problem for many high street retailers, but Greggs is having no problem in pulling in customers and today’s unscheduled update flags that the business is still on a roll.”
Last month the bakery company reported that growth slowed to 12.4 per cent in the third quarter due to strong comparatives in the previous year.
Like-for-like sales increased 7.4 per cent in the 13 weeks to 28 September, down from 10.5 per cent in the first half of the year.
The baker also that increased costs from Brexit – and a slower store expansion plan – would hit growth. But it is planning more vegan baked goods after the success of its vegan sausage roll, which pushed revenue above £1bn back in March.
It previously raised its profit outlook back in May, when its in-house broker, Edison, said it expected full year profit to hit £107m on £1.16bn of revenue.
“Greggs has the magic touch – another upgrade,” Markets.com’s chief market analyst, Neil Wilson, said. “We’re now talking about a £2bn sausage roll seller.
“Despite exceptionally tough prior year comparisons trading in the first part of the fourth quarter has proved remarkably strong.”
Greggs’ share price has risen 59 per cent since this time last year, when it stood at 1,187p, and by 49 per cent since the start of 2019.
Main image credit: Getty