Interactive Investor

ii view: Greggs cooks up strong sales in 2024 so far

Driving a series of growth initiatives and with the potential to expand overseas. We assess prospects for this FTSE 250 high street food-on-the-go business.

5th March 2024 15:27

by Keith Bowman from interactive investor

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Full-year results to 30 December

  • Revenue up 20% to £1.8 billion
  • Adjusted pre-tax profit up 13% to £168 million
  • Final dividend of 46p
  • Total ordinary 2023 dividend up 5% to 62p per share 
  • An additional special dividend of 40p per share

Chief executive Roisin Currie said:

"Reflecting on another year of rapid growth, I am so proud of how our teams have risen to the challenge of serving more customers through more channels. 

"We are very much on track to deliver our bold five-year growth plan to double sales by 2026 and to have significantly more than 3,000 shops in the UK over the longer term."

ii round-up:

Greggs (LSE:GRG) today reported 2023 profit ahead of City estimates, with the UK food-on-the-go retailer flagging a ‘strong’ sales start for 2024 and declaring a special dividend of 40p per share alongside a final ordinary payment of 46p per share. 

Full-year adjusted profit rose 13% year-over-year to £168 million, marginally exceeding analyst estimates for £167 million. Like-for-like, or same store sales for its own managed outlets rose 8.2% during the first nine weeks of 2024, double that of City expectations.

Shares in the FTSE 250 company rose 3% in UK trading having come into this latest news up around a tenth over the last six months. That’s similar to supermarket giant Tesco (LSE:TSCO) and ahead of a 4% gain for the FTSE 250 index itself. 

Greggs opened a record 220 new stores in 2023, taking its UK managed and franchised outlets to 2,473 as of late December. The Newcastle headquartered company believes it remains on track to double sales by 2026 and to have significantly more than 3,000 stores longer term. 

Accompanying management outlook comments again flagged easing inflationary price pressures, with the trend offering improved cost visibility for 2024.

Group cash held of £195 million rose from £192 million at 2022 year-end. If approved at its AGM on 15 May, both the final and special dividend will be paid to eligible shareholders on 24 May.

Broker UBS reiterated its ‘buy’ rating on the shares post the results. A first-quarter trading update is scheduled for 14 May. 

ii view:

Greggs began a transformation from bakery to food-on-the-go retailer back in 2013. Today, its products are now predominantly made in centralised bakeries. Employing around 32,000 people, its outlets are located from high streets to industrial parks. Group strategy includes increasing its digital related sales such as click & collect and delivery; expanding store opening hours into the evening; and investing in supply chain production and logistics.   

For investors, pressured consumer spending given higher rental and mortgage costs cannot not be overlooked. Cost pressures such as those for wages persist, other food-on-the-go companies like McDonald's Corp (NYSE:MCD) are not standing still, while its geographical exposure is limited just to the UK.  

On the upside, growth initiatives including expanding its store numbers are being pushed. Costs such as food ingredients and energy have eased. A focus on product categories such as pizza and chicken goujons is being helped along by both extended opening hours and its digital initiatives, while its value proposition at a time of economic challenge should leave it favoured by cost conscious consumers.

Greggs shares are up over 20% since October and some believe the price has got ahead of itself. However, while there might be friction between bears and bulls in the short term, a consensus City analyst estimate of fair value at just over £32 per share implies value for those prepared to take a longer-term view.


  • Value product offering
  • Several growth initiatives 


  • Uncertainty economic outlook
  • Lacks geographical diversity

The average rating of stock market analysts:


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