Greggs' sales fall amid weak high street trading
Greggs' sales in the first quarter were hit by weak high street trading as the company prepares to close three bakeries.
The retailer said like-for-like sales grew 3.7% in the period, down from 6% in the same period last year.
In a statement, Greggs said: "As has been widely reported, conditions on the high street were softer in March before recovering in recent weeks. These conditions were reflected in our own performance."
The company also said a refurbishment programme and revamping its product ranges have provided a boost, with its flat white coffees helping drive double-digit sales growth in hot drinks.
Greggs hailed new products, such as its teriyaki chicken noodle and falafel with houmous, which have proved a hit with customers.
In March, Greggs said it would shut bakeries in Twickenham, Edinburgh and Sleaford as part of a £100 million investment plan and the firm has now outlined a timetable for their closures.
It said: "The smallest site at Sleaford is now being closed and we expect to close our Twickenham bakery in the fourth quarter of 2016 followed by Edinburgh in the second quarter of 2017."
A consultation with 355 affected staff has begun, and Greggs has vowed to invest instead in its nine remaining bakeries.
In the year to date, Greggs opened 43 new shops, including 23 franchised units.
Clive Black, analyst at Shore Capital, said: "We deem such a trading performance to be very robust indeed against what has been a demonstrably challenging backdrop for the majority operating on the UK high street, tough conditions that have also embraced the likes of Next.
"We have admired Greggs as a company for many years; its values, its evolution and its prospects. Recent trade, against weak high street footfall and a tough comparison of 6%, is impressive as Greggs sustains its heritage in a more modern and sustainable context."