Revenue growth for Greggs as £100m restructuring investment continues

High street bakery chain Greggs PLC has recorded a slight decline in half-year profits despite an uptick in revenues

The Newcastle-headquartered company generated a profit before tax (excluding exceptional items) of £25.9m during the 26 weeks to June 30 2018, down 6.9% from £27.7m the year previous.

But when taking the cost of exceptional items into account – among them, a £100m investment programme to reposition firm’s manufacturing and distribution operations for future growth – Greggs actually made a pre-tax loss of £1.87m during the period.

That figure represents a year-on-year improvement of more than £6.4m; the firm’s pre-tax loss for the same half-year in 2017 was £8.3m

Conversely, Greggs’ revenues for the period rose 5.18%, increasing from £452.9m to £476.3m.

The company is also set to open around 100 net new shops for the year as a whole. As of June 30, it traded from 1,888 stores nationwide.

Greggs chief exec Roger Whiteside said: “Greggs has delivered a resilient performance despite challenging market conditions and we have continued to make good progress with our strategic investment programme to transform the business into the customers’ favourite for food-on-the-go.

“While we remain cautious in respect of the outlook for sales in the balance of the year given the consumer backdrop, we are confident in the medium and long-term growth potential for the business, supported by customers’ response to our initiatives, our strong cash generation and the ongoing strategic investments that we are making.”

He added: “Over the year as a whole we continue to believe that underlying profits (before exceptional costs) are likely to be at a similar level to 2017.”

Want your business, product or service to be seen regionally and nationally? Bdaily helps you get your story in front of the right audience, every day. Find out how Bdaily can help →

Join more than 55,000 subscribers by signing up to our daily bulletin each morning here.