Greggs has warned its profits will fall this year as demand for hot baked goods melted away during the hot spell throughout June.
In an unscheduled trading update, the high street bakery chain reported like-for-like sales growth of 2.6% in the 26 weeks to 28 June, down from 2.9% in the first quarter and a 7.1% increase in the first half a year ago.
Greggs said it made good progress in May but this was followed by slower growth in June as soaring temperatures affected consumer purchasing patterns, with demand for cold drinks rising but overall footfall falling.
The group added it expected first-half operating profits to be lower than a year ago when it reports the results on 29 July. It also warned full-year profits were now expected to dip.
“Whilst acknowledging that comparative like-for-like sales are less demanding in the second half of the year, in light of the current trading conditions the board now anticipates that the full-year operating profit could be modestly below that achieved in 2024,” the trading update said.
Shares crumbled by more than 13% to 1,714p as markets reacted to the profits warning this morning.
Total first-half sales rose 6.9% to £1bn, powered by the opening of 87 new shops – 31 openings in net terms – which took Greggs to a total of 2,649 shops, and put the bakery on track to open 140-150 net openings over the course of the year.
Greggs generated record pre-tax profits in 2024 of £203.9m, 8.3% higher than in 2023, after generating in £2bn in turnover and opening 226 new shops.
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