Shares of Greggs climbed more than 6% on Wednesday after the British bakery chain reported stronger third-quarter sales and raised its full-year guidance. The company said total sales increased 7.7% in the 13 weeks to September 26 compared with the same period last year, with momentum building through the quarter.
The performance was supported by new product launches and more settled weather in August and September, which helped offset ongoing pressure on consumer finances and challenging conditions across the retail sector. As a result, Greggs now expects a “modestly improved” outcome for 2026, having previously guided to underlying pretax profit broadly in line with the £172 million recorded last year.
Production closures to deliver savings
Alongside the trading update, Greggs announced a consultation over the proposed closure of four manufacturing sites. The move could result in around 740 job losses and is part of a broader effort to reshape its production network as the company expands its store estate. Greggs currently operates 2,796 shops and is targeting at least 3,500 locations.
The company said consolidating production would allow it to meet future capacity requirements more efficiently. “We believe such changes, whilst difficult, are necessary to ensure Greggs continues to meet capacity requirements for growth in the years ahead in the most cost-efficient manner,” it said. The restructuring is expected to cost about £60 million but generate annual operating cost savings of around £20 million once completed.
Like-for-like sales accelerate
Like-for-like sales at company-managed shops rose 3.4% in the 13 weeks to September 26, accelerating from a 2.1% increase in the first half. Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said the latest figures showed improving momentum for the retailer. “Greggs served up a tasty trading update, with total sales growth accelerating to 7.7% over the third quarter,” he said, citing more settled weather, ongoing menu development, and new store openings as key drivers.
Chiekrie added that cost inflation remained manageable at around 2%, while the full-year outlook had modestly improved from previous guidance. The company is on track for 100-110 net openings this year, excluding 12 Express locations, making it easier for more customers to access its freshly baked goods.
Greggs refreshes menu as high street remains pressured
Greggs, known for its sausage rolls, steak bakes, vegan offerings and sweet treats, has increasingly sought to broaden its appeal with new products while retaining its value-focused proposition. Adam Vettese, Market Analyst at investment platform eToro, noted that the share price jump suggests Britain’s appetite for sausage rolls remains intact. “Like-for-like sales accelerating to 3.4% is not a boom. It is, however, the first convincing sign that the brand’s value offer and a more interesting menu are cutting through a tired high street,” he said.
Vettese added that while matcha lattes and chicken rolls will not transform the profit and loss statement on their own, they demonstrate Greggs can refresh itself without alienating its core customer base. The company’s combination of store expansion, menu innovation and cost controls will now be tested against persistent inflation and pressure on household spending as it moves through the remainder of 2026.
This article is for informational purposes only and does not constitute financial advice.
