Leading UK bakery retailer Greggs has reported a slowdown in like-for-like growth over the past nine weeks owing to poor weather and the timing of the Easter holidays.
The company, which operates 1,350 retail outlets throughout the UK trading under the Greggs and BAKERS OVEN brands, issued a trading statement to coincide with its AGM, being held today (13 May).
Like-for-like sales in the 19 weeks to 10 May increased by 4.7% but this represents slower growth than for the first ten weeks of the year.
“Having grown by 6.2% in the first ten weeks of the year, as already reported in our preliminary results announcement, like-for-like sales progress slowed during March and April,” chairman Derek Netherton told shareholders.
“This was partly a result of the poorer weather and a less favourable pattern of Easter holiday trading in 2008, together with a change in the phasing of our own marketing investment. However, there is also widespread evidence of reduced footfall on the high street as consumers react to the tightening economic climate.”
Netherton added that the company had always expected its performance in the first half to be constrained by strong comparables with 2007.
“Our ability to achieve the expected steady progress over the year as a whole will depend on the trend in like-for-like sales that emerges in the coming months,” he said. “There has been an improvement in our rate of like-for-like sales growth since the beginning of May (as compared to March and April), but it is obviously too early to tell whether this is likely to be sustained.”
Since the beginning of the year, Greggs has opened 18 new stores and closed ten. There are “a significant number of further openings in the pipeline”, Netherton added.