Greggs plc (LON: GRG) said on Monday its sales recovered sharply in recent months as COVID-19 restrictions started to ease. The company also expressed confidence that its profit this year is expected to hit the record levels seen in 2019. In its previous guidance, the British bakery had warned that its profit was unlikely to return to pre-virus levels before 2022.
Greggs plc shares jumped roughly 3% in premarket trading on Monday and gained another 10% on market open. Including the price action, the stock is now exchanging hands at £26.81 per share. Here’s what you need to know about how do people make money on the stock market.
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In comparison, Greggs had started the year at £17.71 per share after recovering from a low of £11.50 in September 2020.
Greggs reports a 13.5% decline in comparable sales
Greggs said its comparable sales were 3.9% down compared to 2019 in the eight weeks that concluded on 8th May. In the ten weeks to 13th March, its like-for-like sales had tanked by a much wider 23.3%. The combined decline in the eighteen weeks of 8th May stood at 13.5% versus two years ago.
CEO Roger Whiteside commented on the financial update on Monday and said:
“The recovery’s been stronger than we expected. Assuming there are no returns of restrictions and lockdowns, we’re feeling that it could be we get back to our 2019 levels of profit this year which would be a lot earlier than we first anticipated.â€
Greggs wants to open 100 new shops this year
In 2019, the bakery chain reported a record £108.3 million of pre-tax profit but tanked to its first loss (£13.7 million) since going public (1984) last year due to the Coronavirus pandemic. Whiteside acknowledged that customer footfall had not yet returned to 2019 levels but highlighted that spending per visit was higher and home delivery via Just Eat was greatly in demand.
Greggs wishes to open 100 new shops this year. 23 have been opened in 2021 so far, pushing the total up, to 2101. In separate news from the United Kingdom, funeral services provider Dignity plc said its profit jumped 35% in the fiscal first quarter.
Greggs plc performed fairly downbeat in the stock market last year with an annual decline of close to 25%. At the time of writing, the London-listed firm has a market cap of £2.66 billion.
