Wet weather takes a bite out of Greggs’ sales

Greggs: Festive sales slump
Greggs: Festive sales slump
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Greggs, the UK’s largest bakery chain, has revealed a dip in sales over the festive season as last month’s wet weather saw shoppers stay away from the high street.

The group, which has more than 1,670 stores, said like-for-like sales for the five weeks to 5 January fell 2.9 per cent, despite selling a record 8.5 million mince pies – an increase of 7 per cent over the previous year.

Chief executive Ken McMeikan said that, for 2012, total sales grew by 4.8 per cent but like-for-like sales – which strip out the effect of new stores – were down 2.7 per cent.

As well as the bad weather, Greggs was hit by rising costs of its key ingredients and warned it was expecting to pass on “modest” price hikes across its shops this year.

The group publishes its full-year results on 13 March and Scots-born McMeikan – who surprised the City last month by announcing he was leaving to become chief executive of catering wholesaler Brakes – said he was confident the figures would be “broadly” in line with market expectations.

He added: “We expect that the tough trading environment will continue during 2013, with consumers remaining cautious and inflationary cost pressure on a number of key commodities.

“However, having built strong foundations in 2012 for our multi-channel approach, we are well placed to drive further sales growth in the year ahead.”

Cannacord Genuity analyst Wayne Brown described the firm’s performance as “lacklustre”, albeit in line with the broker’s expectations.