UK bakers Greggs sees more growth as shoppers seek value

Britain's Greggs said it expected demand for its value baked goods to continue this year with new products like chicken goujons providing an additional boost, putting it on track to meet growth forecasts despite pressure on consumers.

Britain's Greggs said it expected demand for its value baked goods to continue this year with new products like chicken goujons providing an additional boost, putting it on track to meet growth forecasts despite pressure on consumers. Greggs is expected to grow profit by about 10% this year even though household budgets across the country are shrinking, but it says its value offering plus new products including its Vegan Mexican Chicken-Free Bake will keep sales growing.

For the 10 weeks to May 13, Greggs said underlying sales climbed 15.7%, a rate it expects to normalise over the year. High inflation in Britain, where the bakery and fast food chain operates from 2,300 outlets, has impacted the company over the last year, but it said there was no change in its cost inflation expectations.

Last year, profit was held back by rises in the prices of ingredients, energy and labour. Greggs has previously said it expects cost inflation to be 9%-10% this year. "Although we expect to see ongoing material cost inflation, we have good forward cover on key commodities," the company said.

Analysts are expecting Greggs to report pretax profit of about 163 million pounds ($205.7 million) for 2023 according to Refinitiv data. ($1 = 0.7923 pounds)