British baker and fast food retailer Greggs has slowed the sales decline caused by the coronavirus crisis but does not expect profits to return to pre-pandemic levels until 2022 at the earliest.
Greggs, best known for its sausage rolls, steak bakes and vegan snacks, was performing well before the pandemic and its shares hit a record high of £25.50 last January. They closed at £17.80 on Tuesday, down 25% on the year, valuing the group at £1.8 billion (€1.99 billion)
"Whilst the impact of COVID-19 has been enormous, we have established working practices that allow us to provide takeaway food services under the different levels of restrictions we have experienced," said CEO Roger Whiteside.
Greggs, which cut 820 jobs late last year, said company-managed shop like-for-like sales in the fourth quarter to Jan. 2 averaged 81.1% of the equivalent 2019 level - an improvement from 71.2% in its third quarter.
However, the group still forecast a full-year pretax loss of up to £15 million, against a £114.2 million profit in 2019, reflecting full-year sales of £811 million, down from £1.17 billion.
The pandemic has prompted Greggs to speed up innovations aimed at reaching more customers. Home delivery, in partnership with Just Eat, represented 5.5% of company-managed shop sales in the fourth quarter.
Greggs said that 600 shops now provide delivery services and it expects this to increase to about 800 shops this year.
Despite the pandemic, Greggs opened a net 28 new shops in 2020, expanding its estate to 2,078, ending the year with net cash of £37 million.
It plans to open about a net 100 shops in 2021.