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Mon 15th Sep 2014 - Greggs reports 5.4% rise in like-for-likes
Greggs reports 5.4% rise in like-for-likes: Bakery chain Greggs, the operator of 1,700 outlets led by former Punch Taverns boss Roger Whiteside, has reported like-for-like sales have risen 5.4% for the 11 weeks to 13 September (2013: 1.0% decline), an acceleration on year-to-date like-for-like sales up 3.9%. Total sales growth is 3.5% year-to-date (2013: 3.4%). A total of 153 refits have been completed, with 32 new shops opened, 43 closures. The company reported further margin benefits from commodity deflation and faster progress with structural efficiency initiatives. Whiteside said: “This strong performance reflects a positive response from customers to new product initiatives, improved service, better value and our investment in shop refurbishments alongside more favourable trading conditions. Whilst we face tougher comparatives in the final quarter the combination of strong sales performance, lower costs and our outlook for the remainder of the year means that we now anticipate full year profits to be materially ahead of our previous expectation.” The company added: “Like-for-like sales grew by 5.4% in the 11 week period to 13 September 2014 (2013: 1.0% decline) continuing the strong performance reported at the time of our interim results announcement and reflecting the benefit of the weaker comparative period last year. In the year to date like-for-like sales have now increased by 3.9%. Total sales grew by 4.0% year-on-year in the 11 weeks, including the impact of our accelerated closure programme for poor performing shops. This strong performance reflects a positive response from customers to new product initiatives, improved service, better value and our investment in shop refurbishments alongside more favourable trading conditions than we had expected. In particular our new sandwich range with increased focus on our Balanced Choice options has been selling well. Upgrades to our coffee blend and to some of our core sweet lines have also driven increased sales. In the year to date we have completed 153 shop refits and are encouraged by the results. We still expect to complete around 200 refits in the year as a whole. We have opened 32 new shops in the year to date and closed 43 poor performing units. As at 13 September 2014 we had a total of 1,660 shops, including 42 franchised operations. We expect shop numbers for the year as a whole to be very slightly down. Margins have continued to strengthen into the second half, reflecting on-going deflation in commodity costs, excellent operational cost control and delivery of structural cost savings ahead of plan. Looking forward, we expect the input cost environment to remain benign in the near term and we plan to continue making good operational progress. Our sales-driving initiatives have been delivered in more favourable trading conditions than we had expected with no adverse weather impacts so far this year. We expect to continue rolling out new initiatives, in line with our strategy, in the months ahead. Whilst we face tougher comparatives in the final quarter the combination of strong sales performance, lower costs and our outlook for the remainder of the year means that we now anticipate full year profits to be materially ahead of our previous expectation.”


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