05 March 2024 , 09:12
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Thousands of Greggs workers are going to get a share of £17.6million in bonuses after the bakery made record profits last year.
The boss of Greggs, Roisin Currie, said about 25,000 staff will get extra money this March to say thank you for their hard work in 2023. Greggs saw profits jump last year up to £188.3million from £148.3million the year before.
Sales in shops that Greggs runs went up by 13.7%. On an underlying basis, pre-tax profits lifted 13.1% to £167.7 million.. Greggs will give 10% of its profits to its workers who have been there for at least six months.
Greggs – which employs 32,000 people in total – shares out 10% of profits each year with staff who have worked for the firm for at least six months. It also delivered some cheer for shareholders, with a special dividend payout of 40p a share, on top of a 46p a share final dividend.
Ms Currie said Greggs is optimistic about the year ahead because she says the company offers products that offer value and the company want to stop prices rising in the months ahead. She said: "The consumer is still under pressure in terms of their disposable income. We're certainly not complacent. Retaining that number one for value is very important to us."
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She thinks people might be in a better position financially and spend more after the national living wage goes up in April. "That might well put more money into the pocket of the consumer," she added. Ms Currie called on Chancellor Jeremy Hunt to help cash-strapped shoppers in his Spring Budget on Wednesday and “put money in consumer pockets”.
The company's yearly results showed a slowdown in sales growth due to less contribution from price inflation, dropping to 9.4% in the last three months of the year. The group also said that comparable store sales growth has slowed even more, to 8.2% in the first nine weeks of 2024, but they believe this shows good growth by volume.
The company expressed confidence that Greggs can make good progress this year and is on track to open between 140 to 160 shops this year after opening a record 220 sites in 2023. They added: "Inflationary pressures are reducing and we have improved visibility of costs in the coming year. There is no change to management's expectations for 2024."
The group expects its own cost inflation to be between 4% and 5%, but warned this was "subject to geopolitical risks". They confirmed they were on track with plans set in 2021 to double sales over five years, adding that "what started as a plan is now a solid reality".
Shares in the firm lifted 4% on Tuesday morning. Russ Mould, investment director at AJ Bell, said: “This drive to be the food-on-the-go king is paying off, with Greggs’ market share at an all-time high and the business has now grabbed the top spot for breakfast.”
He added: “The pace of growth actually slowed each quarter during the past year, albeit still delivering the kind of success most companies can only dream of. February was a washout month for all retailers due to the bad weather and that might explain the reduced growth reported by Greggs."