Greggs Profit Expectations Downgraded Amid Changing Weather and Consumer Habits
Popular high street bakery chain Greggs has warned that its full-year operating profits may fall slightly short of last year’s figures, following a slowdown in sales growth during a warmer-than-usual June.
The Newcastle-based company, known for its sausage rolls, sandwiches, and expanding hot and cold food offerings, reported total sales of £1.027 billion for the first half of the year—an increase of 6.9% compared to the same period last year. Like-for-like sales, which exclude new shop openings and closures, rose by a more modest 2.6%.
Greggs noted that while sales performance improved in early May and remained strong through the month, the arrival of hotter weather in June led to fewer customers visiting its shops, although demand for cold drinks rose. Warmer temperatures often lead to shifting consumer habits, with fewer people opting for the brand’s signature hot snacks and baked goods.
Despite the dip in footfall, Greggs has pressed ahead with its expansion plans. In the first half of the year, the company opened 87 new shops and closed 56, bringing its total number of outlets to 2,649. This includes 2,085 company-run shops and 564 franchised units. The company reiterated its confidence in achieving a net increase of 140 to 150 shops in 2025.
The business also continued upgrading its existing estate, completing 108 refurbishments in the first six months of the year. Around 50 more are expected in the second half, part of a broader strategy to modernize its shops and improve customer experience.
Product innovation remains central to Greggs’ growth strategy. Recently launched items such as peach iced tea, mint lemonade, southern fried chicken goujons, and mac and cheese have proven popular, with some gaining traction on social media platforms like TikTok.
In a trading update to investors ahead of its interim results, the company reiterated that ongoing investments—including a new frozen product manufacturing and logistics site in Derby and a national distribution hub in Kettering—remain on schedule.
However, the company cautioned that first-half operating profit is expected to be lower than in the first half of 2024. This is due to a combination of strong comparative figures from last year, timing of shop refurbishments, and efforts to recover rising costs.
Looking ahead, Greggs said its cost inflation outlook remains unchanged and it expects planned cost-cutting initiatives to support performance in the second half of the year. But given current trading conditions, the company now anticipates that full-year operating profit may come in “modestly below” that of 2024.
Despite the challenging retail environment, Greggs continues to push forward with long-term growth plans and remains a strong presence on UK high streets and travel hubs.