Greggs issues profit warning, LFLs down

29 April, 2013

Greggs has issued a profit warning after it revealed like-for-like sales (LFLs) were down 4.4% in the first four months of the year due to the poor weather.

The BB75-leading bakery retailer said it had been particularly hit by adverse conditions in January and March.

But it also said the picture was improving slightly, with the most recent two weeks indicating an underlying rate of LFL decline of around 1.5%, “reflecting in part the beginning of the weaker comparisons seen last year”.

Total sales in the period grew by 3%, driven by its new shop opening programme and the continued development of wholesale and franchise sales.

In a statement, the company, which recently saw the departure of chief executive Ken McMeikan, said: “We do not expect a significant improvement in the difficult underlying market conditions in the short term. The business is focused on continuing with our plans to invest in core sales performance whilst taking action to reduce costs.

“Although we are only four months into the year, based on current own shop LFL performance we believe that profits for the year are likely to be slightly below the lower end of the range of market expectations.”

It added: “We are continuing to experience lower footfall across much of the estate, although average transaction values have increased marginally. Our new shop openings remain focused on locations that have been less impacted by lower footfall, such as workplaces, travel and leisure destinations.”





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