Greggs reveals solid recovery in annual results but costs set to rise

Greggs has published its latest figures for the period covering the 52 weeks ending 1 January 2022.

2021 financial highlights
• Total sales up 5.3% on 2019 level to £1,229.7m (2020: £811.3m, 2019: £1,167.9m)
• Like-for-like sales in company-managed shops 3.3% down on 2019 level
• Pre-tax profit of £145.6m (2020: £13.7m loss, 2019: £108.3m profit)
• Strong cash position supporting planned capital investment programme and special dividend

Strategic progress
Growing and developing the Greggs estate:

• 131 new shops opened in 2021, 28 closures (103 net openings); 2,181 shops trading as at 1 January 2022
• From 2022, targeting 150 annual net new shop openings, with the potential for at least 3,000 shops in the UK over time
• Improving the quality of our estate – 200 refurbishments planned in 2022 to support growth in additional channels

Evening trade:
• Plan to extend late opening to 500 shops in year ahead, offering core menu plus hot food trials

Delivery and digital channels:
• Extending delivery reach from 1,000 to 1,300 shops to complement evening availability
• Further recruitment of, and engagement with, Greggs App customers

Supply chain investment:
• Identifying optimal locations for future investment in supply capacity to facilitate growth ambition

ESG:
• Majority of year one Greggs Pledge targets met, including:
- food waste reduction both in our shops and our manufacturing sites; and
- extending the proportion of items on our shelves that are healthier choices

Current trading
• In first nine weeks of 2022, LFL sales in company-managed shops up 3.7% compared to the 2020 level
• For same period LFL sales in company-managed shops up 44.2% against lockdown affected period in 2021

Roger Whiteside OBE, Chief Executive said, 'Our results and achievements in 2021 show that we have emerged from the pandemic both stronger and better as a business. I would like to thank, once again, all of our teams across the country who rose so well to meet the challenges of the last two years.

“We have started 2022 well, helped by the easing of restrictions. Cost pressures are currently more significant than our initial expectations and, as ever, we will work to mitigate the impact of this on customers, however given this dynamic we do not currently expect material profit progression in the year ahead.

'Despite these near-term pressures, we continue to believe that the opportunities for Greggs have never been more exciting. Our investment over recent years has left the business well-placed to move quickly as the economy recovers and we drive our ambitious plans to become a larger, multi-channel business.”