The firm in a trading update on June 28 said that in previous weeks the impact of pent-up demand for retail had fallen, but like-for-like sales growth in company-managed shops had “remained in positive territory, ranging between 1 and 3 per cent, when measured against the same period in 2019”.
It added: “This level of sustained sales recovery is stronger than we had anticipated and, if it were to continue, would have a materially positive impact on the expected financial result for the year.”
The chain, which has more than 2,000 stores across the UK and boosted sales by launching a vegan sausage roll at the start of 2019, said in May that profits this year could return to the levels seen in 2019 if Covid-19 restrictions continued to be eased as expected.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, has now said: “Greggs has been working hard on its recipe for recovery, and it is bringing home the bacon once more as ovens in city-centre stores have fired back up. The recent trading update shows that insatiable demand for pies and sausage rolls is back.
“The pandemic tore a huge chunk off business as it turned once bustling city centres into ghost towns, but even though commuters are not expected to return in large numbers this year, the company still expects sales to bounce back to pre-crisis levels this year.
“What is helping to drive sales is that Greggs has adapted its operations to keep up with changing snacking habits by rolling out click and collect, which is now available at all its stores. Its delivery service via Just Eat has also been on a roll since the start of the year.
"We may not be back in the office, but our appetite for lunchtime takeaways hasn’t waned; instead many customers have ditched the queue and are happy to wait for a knock on the door instead.
“After the hot success of its vegan sausage roll, Greggs is expanding its meat-free range with the new version of its sausage, bean and cheese melt, which could add extra sauce to sales in the coming months.’’