GREGGS PLC
(“Greggs” or the “Company”)
Q3 TRADING UPDATE
Continued strong financial performance; proposed consolidation of manufacturing operations announced
Q3 highlights
- Total sales up 7.7% for the 13 weeks to 26 September 2026, and 7.4% for the 39 weeks to 26 September 2026
- Company-managed shop like-for-like* (LFL) sales up 3.4% for the 13 weeks to 26 September 2026, and 2.6% for the 39 weeks to 26 September 2026
- Improved trading reflects the success of continued menu innovation along with more settled weather
- 95 new shop openings year-to-date, 38 closures (including 20 relocations), resulting in 57 net new shops opened
- Continue to expect around 100 to 110 net new shop openings in 2026, plus 12 ‘Greggs Express’ convenience retailing installations
- Cost inflation expectations unchanged at circa 2% on a like-for-like basis
- Proposals announced to consolidate in-house manufacturing operations
- As previously communicated, new distribution centres in Derby and Kettering will increase costs in 2027 before contributing to profitable growth thereafter
- Improved trading performance in recent months and continued strong cost control leads us to expect a modestly improved outcome for 2026
* Like-for-like (LFL) company-managed shop sales performance against comparable period in 2025
Trading performance
In the third quarter of 2026, Greggs delivered 7.7% sales growth, with LFL sales in company-managed shops rising by 3.4% compared with the same period in 2025. Trading improved across the quarter, supported by the successful launch of new products and more settled weather in August and September. Year-to-date total sales are up 7.4%, with LFL sales up 2.6%.
Menu development and innovation
Our menu innovation continues to resonate with customers across multiple categories. During the summer, strong demand for our iced drinks range, including Matcha and Cherry Lemonade flavours, supported growth in the drinks category, while the relaunch of our salads has also driven encouraging sales growth. We have also seen continued momentum in sales of healthier and protein-led options, supported by the expansion of our functional drinks range, reflecting growing customer demand for these types of products. As we move into the autumn, we remain focused on bringing customers exciting new flavours across the Greggs favourites they know and love. This includes the highly successful launch of our Steak & Stilton Bake, alongside a range of seasonal hot drinks, hot sandwiches and sweet treats designed to support lunch and snacking occasions throughout the season.
Shop estate and supply chain development
In the year to date we have opened 95 new shops and closed 38 shops (including 20 relocations), resulting in 57 net new openings and a total of 2,796 shops trading at 26 September 2026 (comprising 2,157 company-managed shops and 639 franchised units). Openings in the third quarter included our fifth ‘bitesize Greggs’ at the Tesco Southwark Superstore and our 50th drive-thru site, in Sunderland. The initial trading performance of new shops opened in 2026 is strong, reflecting our disciplined focus on high-quality locations. For the year as a whole, we continue to expect around 100 to 110 net new shop openings. In addition, we continue to test ‘Greggs Express’ installations in franchised locations as we develop this new concept, with 10 open to date and a further two to follow in the remainder of 2026.
Our plans to open new National Distribution Centres in Derby and Kettering are both progressing well. At the Derby site, we expect utilisation of the frozen storage space and picking activity to commence in the final quarter, alongside the commissioning of a new sweet product production line. Our Kettering site, which will be operational in 2027, will utilise increased automation to enable upstream picking of chilled and ambient goods, releasing capacity in our existing Radial Distribution Centres.
Proposed consolidation of manufacturing operations
Greggs is a vertically integrated business and owning and operating our own manufacturing and logistics network remains a key strength. Our investment in additional capacity to serve at least 3,500 shops will enable further growth in the business, creating many more jobs and driving strong returns for shareholders. Alongside this investment programme, we have carried out a comprehensive review to determine where our future manufacturing activity should most effectively be located to ensure we can continue to offer the exceptional value that Greggs is famous for. This review has resulted in a set of proposals that would relocate elements of our manufacturing processes.
Today we have launched a consultation exercise that will consider proposals that could lead to the closure of four sites. This may result in a total of circa 740 roles becoming redundant over a period of two and a half years. 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. Our immediate priority is to minimise the impact on our people where possible. We will enter into a consultation period shortly to work with trade unions and employee representatives of those affected to refine and develop these proposals.
The proposals, subject to consultation, would result in cash costs of circa £60 million comprising capital expenditure of circa £40 million, together with disruption costs and redundancy payments. The annual cash saving in pre-tax operating costs from the conclusion of the change programme is expected to be circa £20 million, and, at this stage, we anticipate that it would be realised across the 2028 and 2029 financial years.
Outlook
Greggs continues to make progress despite challenging market conditions by further evolving its product offer and making the brand even more convenient for a wider range of customers through disciplined estate expansion. Cost inflation remains well managed and is expected to be circa 2% on a like-for-like basis in 2026. This has supported performance in 2026, though there are signs of greater inflationary pressures in 2027. Our proposals to reshape our manufacturing footprint reflect the evolution of the business and our focus on remaining the customer’s number one choice for value in the market.
Our two new distribution centres in Derby and Kettering will become fully operational in 2026 and 2027 respectively and will support the next phase of business growth. As previously communicated, the associated overheads will increase costs in 2027, before contributing to profitable growth thereafter. Improved trading performance in recent months and continued strong cost control now leads us to expect a modestly improved outcome for 2026.