Greggs's focus on sandwiches, coffee and breakfast is continuing to pay off. Today it announced sales were up 5% and like-for-likes were up 5.9% in the 16 weeks to 25 April, above expectations. That's up from 3.8% at the same time last year.
The baker's run of positive figures mark a strong contrast with its performance two years ago, when it was in the doldrums after its strong growth began to falter. Its current chief executive Roger Whitside has shifted its focus away from stodgy pies and pastries, launching new sandwiches, proper coffee, soups and healthy options, in a bid to target busy workers on the lookout for lunch.
That's a strategy that Greggs seems keen to continue with – it's launching an own-label range of low calorie drinks, upgraded salads and fruit pots. Greggs is coming to resemble Pret a Manger more than the greasey bakery of old, although steak bakes and sausage rolls are unlikely to disappear from the menu any time soon.
It's also refurbished 69 shops in the period and opened 24 new ones. Greggs seems pretty confident about its future. 'We expect market conditions to remain favourable and support a good first half performance, ahead of our previous expectations,' the company said.
'In the second half of the year we will come up against stronger sales comparables and a less certain cost outlook. However we expect to deliver good growth for the year as a whole and further progress against our strategic plan.'
The strong run allowed Greggs to pay out a special dividend of 20p per share, worth a total of £20m. Investors were unsurprisingly pleased – Greggs share were up 3.8% to 1,117p at lunchtime. Yum yum.