May 13 - Greggs is the UK's leading retailer specialising in sandwiches, savouries and other baker-fresh food on the go. It has over 1,350 retail outlets throughout the UK, trading under the Greggs and Bakers Oven brands.
The Chairman, Derek Netherton, will deliver the following Interim Management Statement to shareholders at Annual General Meeting to be held in Newcastle upon Tyne later this morning.
'Like-for-like sales in the 19 weeks to 10 May 2008 have increased by 4.7 per cent. Having grown by 6.2 per cent in the first ten weeks of the year, as already reported in our preliminary results announcement, like-for-like sales progress slowed during March and April. This was partly a result of the poorer weather and a less favourable pattern of Easter holiday trading in 2008, together with a change in the phasing of our own marketing investment. However, there is also widespread evidence of reduced footfall on the high street as consumers react to the tightening economic climate.
'We have always expected the Group's performance in the first half of the current year to be constrained by comparison to the particularly strong period in 2007. Our ability to achieve the expected steady progress over the year as a whole will depend on the trend in like-for-like sales that emerges in the coming months. There has been an improvement in our rate of like-for-like sales growth since the beginning of May (as compared to March and April), but it is obviously too early to tell whether this is likely to be sustained.
'Since the beginning of the year we have opened 18 new shops and closed 10, giving us a net addition of eight and a total of 1,376 today. We have a significant number of further openings in the pipeline, which should ensure that we comfortably achieve our target of adding at least 40 net new shops to our portfolio during 2008.
'The Board remains committed to delivering value to shareholders through both increased dividends and the return of surplus cash by making market purchases of the company's own shares for cancellation. We have made no further such purchases since the expenditure of £5.2 million in January, which was noted in the annual report. However, we are seeking the renewal of our authority to buy back shares today, and intend to make further purchases when we consider it to be in the interests of shareholders to do so.
'We are continuing to pursue the various strategic initiatives set out in the annual report, which aim to enhance our customer focus still further, and develop Greggs as a unified national brand. These ongoing changes will strengthen our position in an uncertain time for every business addressing the UK consumer market and the Board remains confident in the prospects for the Group as a whole.
'We shall provide our next trading update to shareholders in the announcement of the Group's interim results for the 24 weeks to 14 June 2008. This is scheduled for Thursday, 31 July 2008.'