High-street baker Greggs has issued a first-quarter profit warning, citing “adverse weather” in January and February and declining footfall across its traditional high-street estate.
Despite total sales in the 17 weeks to 27 April rising 3%, like-for-like sales excluding newly opened stores declined 4.4% compared to the same period last year.
“We do not expect a significant improvement in the difficult underlying market conditions in the short term. The business is focused on continuing with our plans to invest in core sales performance whilst taking action to reduce costs,” the company said in a statement.
“Although we are only four months into the year, based on current own shop like-for-like performance we believe that profits for the year are likely to be slightly below the lower end of the range of market expectations.”
Greggs has recently focused on opening new outlets on sites less affected by declining footfall on the high street, such as workplaces and travel and leisure destinations. In the Q1 period it opened 18 new shops, including six franchised units with Moto Hospitality. There are now 16 Greggs shops operated by Moto under licence in their motorway services. After factoring in eight shop closures, the baker has added 10 shops overall, giving it a total of 1,681.
The profit warning comes on the day that a new behind-the-scenes documentary about the baker will air on TV. More Than Meats the Pie is on Sky1 at 9pm.