Greggs sales lagging a quarter behind last year as baker swings to a loss
Greggs is still struggling to reach the heady heights of last year even after reopening hundreds of sites across the UK, the baker revealed on Tuesday.
Last week the company only sold around 72% of the pasties, drinks and sandwiches that it did in the same seven days in 2019.
However, it said it is finding sales encouraging as things slowly get back to normal.
Greggs bosses will hope for even more growth as the business contends with a swing to a major loss.
Last year, the chain made a pre-tax profit of £36.7 million in the first half of the year, but swung to a £65.2 million loss in the six months to July.
Sales across the six months were down 45% to £300.6 million.
This comes despite the fact that life-for-like sales were up by 7.5% in the first nine weeks of the year.
Chief executive Roger Whiteside said: “Following successive years of unbroken growth, Greggs made a great start to 2020, coming into the year with momentum and clear strategic plans.
“The strength of our business model enabled us to secure the liquidity needed to support our business through the current crisis and then to adapt our operation and strategic investment plans in response to the new environment.”
The firm said that around three-quarters of its staff have now returned from furlough to offer a limited menu to customers.
The fast-food baker also said it is planning to launch click-and-collect and delivery services across the country to help increase sales.
Greggs reopened 800 of its shops for takeaways on June 18, while the rest of its stores began to gradually get back to work from July 2.
Bosses have slowed plans to open more shops – a key part of Greggs’ growth strategy.
In the first six months the company closed 45 sites while opening only 20, and it expects to open around 60 and close 50 over the rest of the year.
There are 2,025 Greggs bakeries across the UK.
Julie Palmer, a partner at Begbies Traynor, said: “The success of Greggs has been the envy of the high street in recent years; however, even the bakery chain hasn’t been immune to the impact of Covid-19, which has forced its stores to close and eaten away at its top line.
“The company has now started reopening stores but, with new social distancing measures having to be implemented and a lack of footfall in town centres, the second half of the year will be an uphill battle.”