Greggs serves up 2.9% sales rise, ups divi

10th Aug 2010 07:15

Bakery and sandwich chain Greggs delivered a 2.9% rise in half year sales and said it remains confident for the full year despite the surge in wheat prices. Pre-tax profit rose to £18.6m in the 26 weeks to 3 July from £16.5m the same time a year earlier. Sales for the period rose to £321m from £312m as it opened 26 new shops and closed eight. Like for like sales were up 0.7%, in line with company forecasts."Our accelerated shop opening and refit programmes are progressing as planned, and delivering encouraging early results," the group said in a statement.Greggs said it increased promotional activity during the period such as 'meal deals' which surged 167% from the same time last year. It also introduced breakfast rolls to help boost sales in its traditionally quieter early morning period."The pressure on the trading environment looks likely to increase in the second half and we remain focused on managing costs tightly. We now expect an increase in ingredient cost inflation in the second half of the year, following the recent rise in wheat prices," said chief executive Kennedy McMeikan. However despite the challenging trading environment, Greggs says it remains on track to deliver another year of progress. Greggs has recommended an interim dividend of 5.5p per share, up 5.8% from last year.