Greggs, the UK bakery chain, lifted it's profit and sales outlook for the fourth time this year in it's trading update on 11th November.
The news was taken positively by investors as results and guidance beat their estimates with the stock rising as much as 14.2% in the hours following the annoucement, taking the total share price gain to 78.7% for the 2019 year to date period. This compares to the 4.45% decline in the FTSE 100 index over the same period.
The baker and takeaway food group synoymous with sausage rolls has rallied after management's tempering of investor expectations when they suggested that third quarter sales growth was still robust but growing. Despite this, results still beat consensus estimates and the chain continues to be a stand-out performer on the UK high street where many peers are struggling, closing stores, or shifting to internet sales.
The firm which has more than 2,000 retail stores in the UK said that total sales for the six weeks to November 9th had growth 12.4% while LFL saleswere up 8.3% which showed an acceleration on last quarters figure of 7.4%.
Woozle Research has held either a long or conviction long recommendation on Greggs shares since the start of the year which has netted clients a 74% return versus the market. Our primary research continues to show stronger than expected sales gains from the introduction of new healthy ranges, market share gains in the hotly contested breakfast to go market, operational and technology improvements on the shop floor, delivery and inventory management upgrades that have improved efficiencies, and the much publicised growth in sales of vegan products.
Our analysis shows that most of the cost price pressures stores have faced have been passed onto customers with no impact on total volume sales and longer opening hours have helped to make for easier YOY comparables. In tandem, a stronger focus on expanding online delivery options has helped to boost brand marketing, customer awareness, and sales of new ranges.
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