Big plans at Greggs

Mar 11 2008 by jez Davison, Evening Gazette

THE boss of North East bakery Greggs has revealed the firm’s expansion plans will be largely outside of its regional heartland, as it announced annual results that were “ahead of market expectations”.

Total group sales for the 52 weeks to 29 December were up 6.4% to £586m, while like-for-like sales increased by 5.3% and operating profit excluding property gains and restructuring costs rose by 13% to £47.7m.

Managing director Sir Michael Darrington said only “a few” of this year’s planned net addition of 40 outlets will be opened in the North-east, with the firm looking to expand its influence in Scotland in particular.

He said: “We are now a national brand with North East roots.

We have a good brand awareness in the region and we are trying to get ourselves known in areas where we are less well known.”

The company described the results as “excellent in a tightening market,” although recent steep rises in commodity prices would be passed onto the consumer. It predicted only modest increases in operating profit in 2008 to around £48-49m.

Mr Darrington said the company planned to grow organically first and foremost, although further acquisitions could not be ruled out. “We prefer organic growth because taking on another firm means we have to take on another brand and integrate it into ours.”

The company recently appointed a new social responsibility director, Graham Randell, the former managing director of Greggs North East.

Richard Hutton, finance director of Greggs plc, said: “This is a very high-level appointment. He will provide a focal point for coordinating our strategy for social responsibility.”