Greggs sees shares rise as sales hit £476m mark
Investors are gobbling up Greggs shares after the company, which has 15 stores in Northern Ireland, posted a rise in sales and hiked its dividend.
Total sales for the 26 weeks ending June 30 were up 5.2% to £476m, representing like-for-like sales growth of 1.5%.
Underlying operating profits, excluding profits from the sale of property and a £1.9m restructuring charge, came in at £25.7m, down from £27.6m the year before.
Greggs increased its ordinary interim dividend by 3.9% to 10.7p per share.
Following the announcement, Greggs' share price shot up by 7.5% or 72.5p to 1,034p.
The food retailer said it had delivered good growth in its newer product categories such as hot drinks, breakfasts and healthier ranges.
However, the company remains cautious about its outlook, given the difficulties faced by both high street retailers and restaurant groups.
Costs have been rising for these businesses, with business rates, labour costs and input price increases all putting pressure on firms.
"Greggs' revamped summer menu and a wider choice of value meal deals appear to have caught the eye of the cost-conscious consumer in the relentless heat," said Kate Heseltine, analyst at Edison Investment Research.
"The emphasis for new outlets remains firmly focused on locations that capture work, travel and leisure-related footfall, thus reducing the chain's high street exposure."