Greggs (GRG.L) has revealed its sales jumped by nearly a quarter last year as its move to open some bakeries later into the evening is paying off.
Workers at the bakery are also in line to share a £16.6m bonus payout following a boost in profits. Staff are set to receive an average of £700 each as a bonus to be paid in March, according to the Evening Standard.
Greggs reported like for like sales growth in company-managed shops of almost 18%, taking revenues above £1.5bn during 2022. Pre-tax profits came in almost 2% higher at £148.3m.
The bakery extended the opening hours of 500 shops until 8pm or beyond last year, as it competed for “food-on-the-go” sales in the evening.
Products such as chicken goujons and pizza slices have proved popular in the evenings, Greggs reports, and sharing boxes have been a hit via its delivery service.
The firm has announced it will also be moving 40 branches to new, bigger locations and will open 24-hour drive thru service at some branches.
Greggs said it achieved a record 186 new shop openings over the year and closed 39, taking its estate to 2,328 shops. It plans 150 new openings this year as it aims for more than 3,000 UK shops.
The cost of living squeeze has led more consumers to rely on low-cost meals.
Chief executive Roisin Currie said: “If you are a person who is out and about – whether you are going to work, or going to college or going to meet friends and you need to eat, then you are coming into Greggs and having a breakfast for £2.60, a lunch for £3.60, or an evening meal offer.
“It is an easy way to fuel yourself when you’re on the go and you need to eat.”
Cost inflation is expected to remain a challenge this year, reaching levels of 9% to 10%, driven by staff pay pressures and energy costs.
But Greggs said it has managed to pass on some of the cost inflation to consumers through price rises.
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The price of its popular sausage roll is now £1.20, having cost £1 at the start of 2022 and being subject to several price rises throughout the year.
Currie assured there are no current plans to increase prices further, but stressed it will have to keep prices under review in the “uncertain market”.
Matt Britzman, an equity analyst at Hargreaves Lansdown, said: “Nine to 10% inflation over 2023 is by no means an easy hurdle to overcome, but the group’s secured forward cover for all electricity requirements up to the end of the third quarter and made progress on locking in some food and packaging costs too.”