Greggs Navigates Challenging Market, Maintains Growth Trajectory

Greggs PLC (LON: GRG) has released its Q4 trading update, showcasing a resilient performance in a challenging economic environment.

The company reported a 7.4% increase in fourth-quarter total sales, with company-managed shop like-for-like sales up by 2.9%. For the full year 2025, total sales rose by 6.8% to £2,151 million, compared to £2,014 million in 2024.

Despite subdued consumer confidence impacting the food-to-go market, Greggs has outperformed competitors, gaining market share. The company's ability to deliver value through initiatives like the £5 Big Deal offer and a strong lineup of seasonal favorites has resonated with budget-conscious consumers.

Headline Numbers:

• Revenue: FY25 total sales reached £2,151 million, a 6.8% increase year-over-year, demonstrating steady growth in a competitive market.
• Like-for-like Sales: Company-managed shop like-for-like sales increased by 2.4% for FY25, and 2.9% in Q4, indicating positive organic growth despite market headwinds.
• Net Cash: Year-end net cash stood at £47 million, down from £125 million in 2024, reflecting investment in expansion and supply chain development.

The company's expansion strategy remains a key driver of growth. Greggs opened 207 new shops in 2025, averaging four openings per week, and plans to open around 120 net new shops in 2026. This aggressive expansion, coupled with strategic relocations, strengthens Greggs' presence in both existing and under-penetrated markets.

The decrease in net cash reflects the peak of Greggs' capital expenditure program, particularly the development of its supply chain infrastructure. The phased operational roll-out of the Derby facility from mid-2026 is expected to enhance efficiency and support future growth. The completion of the initial build phase of the Kettering distribution center, slated to open in 2027, further reinforces this commitment.

Driver Breakdown:

• Value Proposition: Successful initiatives such as the Breakfast Deal and £5 Big Deal have attracted customers seeking affordable meal options.
• Estate Expansion: Strategic shop openings and relocations are extending Greggs’ reach and improving convenience for customers.
• Cost Management: Ongoing efforts to reduce structural costs have delivered £13 million in efficiencies in 2025, mitigating input cost increases.

Roisin Currie, Chief Executive commented: “We made good progress in 2025, in a challenging year where subdued consumer confidence impacted the food-to-go market. Against this backdrop, I'm pleased that Greggs outperformed the wider market and increased its market share of visits.”

Looking ahead, Greggs anticipates full-year profits in line with previous expectations, despite headwinds from consumer confidence and supply chain investments.

The company expects like-for-like cost inflation to be lower in 2026 and aims to maintain its value leadership. Profits are expected to be at a similar underlying level to 2025, with any improvement contingent on a recovery in the consumer backdrop.