London, Oct 9 - British bakery chain Greggs has cut its full-year profit forecast by 3 million pounds ($5.3 million), blaming a weather-related dip in sales and a decision not to pass on higher costs to cash-strapped customers.
The firm, which sells sandwiches and snacks from around 1,400 shops, saidon Thursday like-for-like sales growth was 3.9 percent in the 16 weeks to Oct. 4, down from 5.8 percent after six weeks.
The slowdown was due to "extremely poor weather" in August and early September, with like-for-like sales growth back up to 5.7 percent in the last three weeks of the period, it said.
The group said it had seen "only modest erosion of customer numbers and transaction values", despite a broader slowdown in spending as shoppers react to higher food and fuel costs, sliding house prices and growing economic uncertainty.
But it took the decision not to pass on the full rise in its own energy and raw material costs, it said.
"As a consequence of the period of slower sales growth and temporary margin impact from higher costs, we are reducing our expectations of operating profit for the current financial year by some 3 million pounds," Greggs said in a trading update.
It did not say what its profit expectations were.
"The final outcome for the year will clearly depend on trading during the weeks ahead. However, we believe that our budget for the remaining part of the year is achievable."
Greggs said it was also cutting its capital spending for the year to 36 million pounds from 40 million planned previously.
Greggs shares closed at 34.26 pounds on Wednesday, valuing the business at about 356 million pounds.