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Shares in Greggs (GRG.L) surged 7% on Tuesday morning, after the UK bakery chain highlighted a pick-up in sales, with a boost from its iced drinks and its "viral" mac and cheese.
The food-on-the-go retailer said total sales were up 7.4% to £784m in the first 20 weeks of 2025. Like-for-like sales grew by 2.9% in that time, with Greggs noting improved performance in the last 11 weeks, which it said was helped by better trading conditions.
That marked an improvement on the 1.7% growth in like-for-like sales Greggs said it had seen in the first nine weeks of 2025, in an update on trading in March in its preliminary annual results. The company cited challenging weather conditions in January but said trading had improved in February.
Greggs said in its latest trading update on Tuesday that product innovation was playing its part in helping performance. The bakery chain said its over-ice drinks range, now available in 1,300 shops, was performing well, highlighting the launch of two new flavours: peach iced tea and mint lemonade.
In addition, Greggs said its pizza boxes continued to see strong demand, while its newly launched mac and cheese had gone "viral" on TikTok.
Following an initial trial last year, Greggs said that its made-to-order range, which included chicken burgers, wraps and fish finger sandwiches, was now available in 300 shops and was proving popular with customers "looking for a more substantial and personalised meal".
Greggs said it had also recently added a new feta, red pepper and spinach bake to its iconic savoury range.
During the first 20 weeks of the year, Greggs said it had opened 66 new shops but closed 46 sites, making a total of 2,638 shops trading as of 17 May.
The company said the closures were weighted to the first half of the year, so it remained confident about achieving 140 to 150 net openings during the full year.
Looking ahead, Greggs said its plans to manage "inflationary headwinds are progressing well", and that while it was still early in the financial year, its board's expectations for the year remain unchanged.
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"With inflation expectations accounted for, management can crack on and focus on turning Greggs from your early pastry fix to a genuine grab-and-go dinner option," said Dan Lane, lead analyst at Robinhood.
"The evolution from bakery to fully fledged food-to-go offering was stellar but keeping that pace of growth alive is much harder," he said. "Expanding the store count, extending the menu and opening into the evenings look to be core tenets of this strategy but that’s all a big change from the lunchtime steak bake blueprint that made the stock such a market darling. The difficult second album has a new sound and the old fans will take some convincing yet."