Greggs staff to share £17.6m bonus pot after record annual profit | Greggs

Thousands of Greggs workers will share a £17.6m bonus pot this month after the bakery chain famous for its sausage rolls and steak bakes made a record annual profit.

Britain’s biggest bakery chain said 25,000 employees – out of a total of 32,000 across the UK – would receive a bonus in their pay packets at the end of March, as it reported a 27% jump in profits to £188m.

Under a profit share agreement, Greggs shares 10% of profits each year with staff who have worked at the chain for at least six months. The payment to each employee varies: for example, someone working 22 hours a week with six years’ service will receive £765.

Greggs said there was better news for its customers too, with no further price rises planned this year. It had increased prices by between 5p and 10p on a some items in December but held down the cost of bestselling items including its sausage rolls and vegan sausage rolls.

Roisin Currie, the Greggs chief executive, said: “We have no plans for further price rises. We’re still talking about the cost of living crisis. We know that the consumer disposable income remains under pressure.

“It’ll be another tough year, last year and the year before were tough for the consumer, and that may continue through this year. What’s helpful is that we are seeing a lower level of inflation in the economy.”

Greggs expects cost inflation of between 4% and 5% this year, although this partly depends on geopolitical risks. Cost inflation averaged 8.5% last year but ended 2023 closer to 5%, as pay was fixed from January, food and packaging price rises slowed during the second half and energy costs were less volatile.

The company raised its dividend payout to shareholders, after posting 8.2% growth in like-for-like sales – at stores open at least a year – in the first nine weeks of 2024. Pre-tax profit rose 27% to £188m in 2023. Sales in company-managed shops climbed 13.7% year on year.

The chain introduced a new range of flatbread sandwiches and new savoury bakes, including the spicy vegetable curry bake. It said evening meals such as chicken goujons, potato wedges and pizzas were selling well, and it brought back the vegan steak bake after customers asked for it.

The national minimum wage rise to £11.44 an hour for adults aged 21 and over from 1 April will help to “put some more money into the pockets of the consumer”, Currie said.

The company said its market share was a record high, with its share of food-to-go visits 8.2%, up from 7.7% in 2022. Its share of food-to-go breakfast visits climbed to 19.6%, taking it to the top position.

The evening is the fastest-growing part of the day, and Greggs is looking to hire more staff to serve customers on their way home from work. Delivery sales grew 23.6% last year after partnerships with Just Eat and Uber Eats.

Greggs runs 2,473 shops after 145 net openings last year, including at Canary Wharf and Waterloo stations in London and at Gatwick airport. It intends to open up to 160 net new shops this year, as it is aiming for more than 3,000 UK stores over the longer term. It has partnerships with retailers including Primark, Tesco and Sainsbury’s.

The bakery chain raised its dividend payout to shareholders, after posting an 8.2% growth in like-for-like sales – at stores open at least a year – in the first nine weeks of 2024.

Greggs shares were up 5% on Tuesday morning, making it one of the biggest risers on the FTSE 250.