Update boosts Greggs shares

Jan 8 2009 by Peter McCusker, The Journal

THE UK’s leading share index lost ground yesterday as investors took advantage of the recent market gains to lock in some profit. The FTSE 100 Index fell 131.41p to close at 4507.51.

In the regional portfolio, Greggs, where we act as joint broker, released a trading update yesterday, which stated that total sales for the second half of the Group’s financial year had risen by 6.6%.

Gregg’s like-for-like sales growth over the Christmas period, which is the four weeks to January 3, 2009 increased by 5.3%.

Ken McMeikan, chief executive, expects the full year results to be in line with expectations and commented that the group is “well placed to weather the recession and benefit from opportunities for future growth”. The shares closed higher 79p at 3400p.

Elsewhere in the North 40, Royal Bank of Scotland (RBS) increased its price target for Bellway from 480p to 540p, and raised Barratt Developments from a “sell” rating to “hold”. Bellway closed 13.5p higher at 615p and Barratt Developments improved 6.25p, ending the session at 89.5p.

RBS also cut the price target for Go-Ahead Group from 1980p to 1220p. As a result, the shares drifted down 21p to close at 1150p.

Northgate, the commercial vehicle hire business, announced that Aviva, the insurance group, is now interested in 5.08% of the company’s voting rights, up from the 3.31% announced on Monday. Northgate’s share price rose 0.25p to 93.5p.

Northumbrian Water Group was also out of favour with investors after Evolution downgraded the UK water sector from “buy” to “add”. The shares fell 4p to 261p.

Demelza.Claypole@brewin.co.uk