Bargain-seeking customers bring New Year’s cheer to Greggs and B&M | Greggs

Greggs plans to open 150 extra shops this 12 months, and B&M can pay its shareholders a particular dividend of £200m as each low cost value chains profit from in search of bargains throughout the price of residing disaster.

The bakery chain, well-known for its scorching canine rolls and steak ovens, mentioned gross sales at its established shops rose 18% as Christmas approached, as Omicron did not care concerning the affect of rail strikes and chilly climate so it may get well from a foul 2022. prompted many individuals to keep away from major streets and workplaces.

Complete gross sales within the three months to 31 December rose 23% to £1.5 billion.

B&M will pay special dividends of £200m to shareholders.
B&M can pay particular dividends of £200m to shareholders. Photograph: Might James/Reuters

B&M mentioned gross sales rose 12.3% within the three months to December 24, and revenue margins improved, with robust gross sales in its groceries and basic merchandise traces. The corporate is paying a particular dividend of 20p on shares after “robust momentum through the golden quarter”. The extremely worthwhile three months of the 12 months are often called the golden quarter in retail.

Greggs mentioned their festive bakeries, mince pies, and salted caramel lattes are promoting significantly properly, and are experiencing the quickest will increase in gross sales within the early night as extra shops are opened for takeaway meals.

He mentioned that as followers of the bakery chain search for methods to save cash, the usage of its low cost app can also be growing.

However the firm has warned of “tangible price inflation”, implying it could have to boost costs once more in 2023 after two rounds of will increase final 12 months.

Roisin Currie, CEO of Greggs, mentioned: “We’re coming into 2023 in a robust monetary place that can enable us to put money into shops and provide chain capability to convey Greggs to much more prospects throughout the UK. Market situations in 2023 proceed to be difficult. Nevertheless, our value-for-money providing of freshly ready food and drinks is extraordinarily vital as customers need to handle their budgets with out sacrificing high quality and style.”

Sophie Lund-Yates, lead fairness analyst at Hargreaves Lansdown, mentioned Greggs benefited from the “flocking to worth” of customers throughout the price of residing disaster.

“Greggs is so assured its robust enterprise will proceed that it plans to open 150 shops this 12 months and continues with prolonged hours at greater than one-fifth of its services,” he mentioned.

“There’s truly so much entering into Greggs’ favour, as a result of he is on the finish of the worth spectrum and the group is benefiting from that. Nevertheless, it is going to be essential to observe intently how out-of-home spending is shaping up, as a result of worse-than-expected declines coupled with rising prices can be unhealthy information for earnings. ”

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