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February storms batter Greggs after record year

The business said the outbreak of coronavirus is causing ‘some uncertainty’.

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Greggs launched a new vegan steak bake in January (Owen Humphreys/PA)

Greggs launched a new vegan steak bake in January (Owen Humphreys/PA)

Greggs launched a new vegan steak bake in January (Owen Humphreys/PA)

Greggs was somewhat blown off course by windy weather in February, the business said as it revealed a big jump in both profit and sales last year.

The company, which launched its new vegan sausage roll in January 2019, said the year had brought a 31% increase in pre-tax profit to £108.3 million, on revenue of almost £1.2 billion, up 13.5%.

But chief executive Roger Whiteside warned that storms battered the food-to-go giant last month.

2019 was an exceptional year of progress for GreggsRoger Whiteside, chief executive

“We made a very strong start to 2020 in January, but in February saw a significant slowdown in sales growth as a result of the storms that have affected the UK,” he said.

The bakery chain said it has also run out of vegan doughnuts and welsh cakes as a result of the storms, after one of its major bakery and distribution sites in Wales was flooded.

It said the distribution site is now operational again, but some machinery was impacted by the flooding.

Around 40 stores were closed for “three or four days” after the site’s closure impacted the supply chain, Greggs said.

Nevertheless, despite these headwinds, like-for-like sales in Greggs shops managed by the company rose by 7.5% in the nine weeks to the end of February.

Mr Whiteside also warned that the business could face trouble from the coronavirus outbreak, which is causing “some uncertainty”.

2019 was a record year for Greggs, as it opened 97 more bakeries than it closed, taking its total number of shops to 2,050.

Mr Whiteside said: “2019 was an exceptional year of progress for Greggs, during which we experienced a sustained increase in customer visits as increased awareness and appreciation of our brand gathered momentum.

“We expect to make year-on-year progress and will do so from a strong financial position, supporting our investment for further growth whilst also delivering good returns for all stakeholders.”

The chief executive said the new vegan range, which now includes the steak bake, as well as doughnuts, “has been our most successful product initiative in recent years”.

He added that there were more opportunities to sell meat and dairy-free versions of its best-selling lines.

Coffee and hot drinks are also promising markets, and the business is about to start investing in its coffee machines.

Greggs is now the UK’s third biggest seller of takeaway coffee after overtaking Starbucks during the year, it said.

Mr Whiteside said the business had considered opening a national chain of stores offering only health products. However the team discovered there was not enough demand to justify such a launch.

PA