Greggs Regulatory News (GRG)

9 Oct 2007 07:01

Greggs PLC09 October 2007 9 October 2007 GREGGS plc AUTUMN TRADING UPDATE Greggs is the UK's leading retailer specialising in sandwiches, savouries and other baker-fresh food on the go. It has over 1,300 retail outlets throughout the UK, trading under the Greggs and Bakers Oven brands. Group Managing Director Sir Michael Darrington reports: "I am pleased to reporta further improvement in our like-for-like sales performance since we announcedour interim results on 31 July. Like-for-like sales in the first 16 weeks ofthe second half to 6 October 2007 have grown by 5.9 per cent, including corevolume growth of 1.8 per cent. This strong performance has been assisted byfavourable weather in August and September, and compares with a disappointingperiod of flat like-for-like sales in 2006. "Operating profit for the second half to date is above the comparable periodlast year. "As we stated in the interim report, we are bearing significant increases in thecost of several key ingredients, including flour and dairy products, withprotein price rises in the pipeline. These cost pressures have been mitigatedto some extent by forward buying. Our robust performance to date encourages usto believe that current and anticipated cost increases will be recoverable fromthe market place, with our selling price inflation continuing to run at aroundthe current level of 4.5 per cent. "The second phase of our integrated marketing campaign was launched with afurther burst of TV advertising last month. Although its focus is on buildinglong-term national awareness of the Greggs brand, we believe that it hascontributed to our positive sales performance. "The restructuring of our business to create a unified, responsive, nationalGreggs brand is proceeding to plan. "Development of our new Glasgow bakery has been completed on time and to budget,with the final production transfers to the new site being completed last week.This excellent facility will further enhance the efficiency and growth potentialof our successful Scottish business. "In the current year to date we have opened 37 new shops and closed 20, making anet addition of 17 and a total of 1,353 units trading at 6 October. We nowexpect to achieve a net addition of around 30 shops over the year as a whole, anincrease on our previous target of 20-25. "We have continued to return cash to shareholders through our share buybackprogramme. In the second half to date we have so far bought a total of 325,449ordinary shares at an average price of £48.57 and an aggregate cost of £15.9million. "Comparatives become somewhat more demanding in the remainder of the secondhalf, when like-for-like sales in 2006 increased by 2.0 per cent. Nevertheless,we are encouraged by our progress to date and continue to believe that this willbe a year of satisfactory progress for Greggs." ENQUIRIES: Greggs plc Hudson SandlerSir Michael Darrington, Managing Director Wendy Baker / Jessica Rouleau Richard Hutton, Finance DirectorRaymond Reynolds, Retail Director Tel: 0191 281 7721 Tel: 020 7796 4133 This information is provided by RNS The company news service from the London Stock Exchange