The boss of the UK’s largest bakery chain has denied that Britain has reached “peak Greggs”, after reporting a drop in earnings as consumers lost their appetite for baked goods such as sausage rolls and pastries during recent spells of hot weather.
Greggs, which operates 2,649 shops across the UK, notched up more than £1bn in sales in the first six months of the year for the first time, but its profits fell as it battled rising costs, lower footfall and more weather disruption than in 2024.
The company reported a pre-tax profit of £63.5m in the 26 weeks to 28 June, down 14.3% compared with a year earlier. It had warned at the beginning of this month that its profits would be lower after consumers shunned flaky bakes in favour of cold drinks during the hot weather.
“I absolutely don’t believe we have reached peak Greggs,” the company’s chief executive, Roisin Currie, said.
“There have been previous times in our history where we have seen downturns and we came back through again. The business is fundamentally strong.”
She said there were still parts of the UK where the public had no access to a Greggs, and that the chain was underrepresented in retail parks, supermarkets and roadside and transport locations.
The company has plans to open about 150 stores a year and is testing out “bite-size” Greggs – a smaller outlet focused on a narrow range of its bestsellers – so that it can rent pricier locations in the south.
Currie said sales had been hit during the warm spell across much of the UK as people ate less on very hot days.
She said trade at breakfast time remained resilient but that sales, particularly of hot foods, were down during the rest of the day as temperatures rose. Iced drinks were one of the few items to buck the trend.
Currie described conditions as challenging, with consumer confidence low and people “saving rather than spending”, especially those on lower incomes.
Greggs said its customers bought baked goods more often when they had “convenient access” to its shops, based on analysis of how its app and stores perform. As a result, the company – which sells about 1m sausage rolls a day – still plans to open at least 350 more outlets, including about 150 this year, and said it could see “clear opportunity” for operating more than 3,000 in the future.
It intends to open more stores in areas “beyond traditional high street locations”, and relocate existing shops to better sites. It will roll out its frozen “bake at home” range to Tesco supermarkets from September.
Despite this, the company’s half-year results have prompted some analysts to raise concerns that UK appetite for Greggs could have peaked as health-conscious consumers choose lower-calorie options instead of pastries.
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“Greggs had warned profits would be lower than the same period last year, as the UK’s good weather stifled demand. This will do little to address fears the UK has hit peak Greggs,” said Zoe Gillespie, a wealth manager at RBC Brewin Dolphin.
Others queried why the company had not shared more information about how sales had fared over the past month, at a time of school summer holidays when it is expected that tourists and day-trippers would be seeking out food on the go.
“Lack of information on current trading has left investors wondering if the business has become as stale as a day-old Belgian bun,” said Russ Mould, the investment director at the broker AJ Bell.
“This situation won’t stop the growing debate about whether Greggs has reached peak sausage roll.
“There are suggestions it has grown too fast, the menu is too bloated and consumer tastes are changing. People want healthier options, and while Greggs has some of these in its stores, the core pastry-based items remain its bread and butter.”
Currie said more than 30% of Greggs’ product range were now healthy options and that the company was mindful of the potential future impact of diet drugs such as Ozempic.
She said the proportion of the population taking such drugs was currently very small and so any change in their eating habits was unlikely to have contributed to a slowdown in sales at the chain. However, “it is important for us to have a variety of protein-led options to cater for them”, she said.