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UK's Greggs beats forecasts with 10 pct profit rise
February 28, 2017 / 7:45 AM / 9 months ago

UK's Greggs beats forecasts with 10 pct profit rise

LONDON, Feb 28 (Reuters) - British baker Greggs on Tuesday beat forecasts with a 10 percent rise in 2016 profit, helped by an extension of its product range, new outlets and store refurbishments.

The Newcastle, northern England, based firm, which is transforming itself from a traditional bakery business into a food-on-the-go retailer, said it made a pretax profit before one off items of 80.3 million pounds ($99.8 million) for the year to Dec. 31.

That compared to 73 million pounds in 2015 and analysts’ average forecast of 78.7 million pounds, according to Thomson Reuters data.

Total sales rose 7 percent to 894.2 million pounds with sales at company-managed shops open over a year up 4.2 percent.

Greggs said it had improved its product range, extending choice in hot drinks, hot food and healthy options over the period. It refurbished 208 shops and opened a net 66 shops, taking the total to 1,764.

The firm said trading in 2017 has started in line with expectations, with like-for-like sales at shops which they manage up 2 percent in the eight weeks to Feb. 25.

Greggs reiterated that the UK consumer outlook was more challenging than it has seen in recent years, with industry-wide pressures emerging in commodities as well as labour costs.

“However we are confident of making further progress,” it said.

Shares in the firm, which have risen 10 percent over the last three months, closed Monday at 1,011 pence, valuing the business at 1.02 billion pounds. ($1 = 0.8050 pounds) (Reporting by James Davey; editing by Costas Pitas)

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