Greggs Plc · LSE:GRG
Greggs — FY2024 Earnings Presentation
32 slides from Greggs's earnings presentation, March 2025
Slide 1: For the 52 weeks ended 28 December 2024
For the 52 weeks ended 28 December 2024 MARCH 2025
Slide 2: Agenda
AGENDA Highlights Financial performance Operational and strategic review Current trading and outlook 2
Slide 3: Record sales and profit
RECORD SALES AND PROFIT £2,014.4m +11.3% +5.5% £254.2m Company-managed Total sales Total sales growth Free cash inflow* LFL sales growth * Free cash inflow defined as net cash inflow from operating activities after lease payments. £189.8m +13.2% +15bps 69p Underlying PBT Total dividend per Underlyin
Slide 4: Strong strategic progress
STRONG STRATEGIC PROGRESS - Remain the #1 FTG brand overall and #1 for value* Brand appeal – Greggs remains the #1 FTG brand overall and #1 for value* Estate - Record number of shop openings in 2024, strong returns and healthy pipeline Evening - 9.0% of company-managed shop sales in 2024 (2023
Slide 5: Further progress in strategic growth initiatives
FURTHER PROGRESS IN STRATEGIC GROWTH INITIATIVES Delivery – increase following 16% roll out with Uber Eats Proportion of sales in evening or via delivery 24% Proportion of transactions with Greggs App 14% 22% 20% Evening walk-in and delivery – 12% 18% 10% 16% continued steady growth with 8% 14%
Slide 6: Brand strength continues to build
BRAND STRENGTH CONTINUES TO BUILD YouGov Brand Health 2021 2024 (December 2024 vs. December 2021) 45 CONSIDERATION 32.2% 38.8% KEEPING GREGGS FRONT OF MIND 40 NO.1 BRAND NO.1 BRAND NO.1 BRAND FOR 35 OVERALL FOR VALUE CONSIDERATION 30 IN 2024 25 PURCHASE INTENT 12.3% 17.5% 20 MORE REASONS TO SHOP WIT
Slide 7: Financial performance
FINANCIAL PERFORMANCE RICHARD HUTTON CHIEF FINANCIAL OFFICER
Slide 8: Income and expenditure overview
INCOME AND EXPENDITURE OVERVIEW 2024 2023 £m £m Sales 2,014.4 1,809.6 +11.3% Underlying operating profit 195.3 171.7 +13.7% Finance income 8.1 6.1 Finance expense (inc. leases) (13.6) (10.1) Underlying profit before tax 189.8 167.7 +13.2% Exceptional gain 14.1 20.6 Profit before tax 203.9 188.3 Inco
Slide 9: Good sales growth across business channels
GOOD SALES GROWTH ACROSS BUSINESS CHANNELS 2024 2023 £m £m Company-managed shops 1,781.7 1,610.9 +10.6% Business-to-business 232.7 198.7 +17.1% Total sales 2,014.4 1,809.6 +11.3% Company-managed sales growth driven by LFL cash increase of 5.5%, plus net estate growth and relocation of constrained
Slide 10: Improved margin and strong ROCE
IMPROVED MARGIN AND STRONG ROCE 2024 2023 Sales £2,014m £1,810m Gross margin reflects strong management of supply costs Gross margin 61.8% 60.8% and benign food and packaging inflation Distribution & selling costs (47.2%) (46.7%) D&S ratio reflects wage cost inflation and good control of Adminis
Slide 11: Employment costs the main contributor to cost inflation
EMPLOYMENT COSTS THE MAIN CONTRIBUTOR TO COST INFLATION Food & packaging Underlying cost base People Other, 9.5% overall wage and Marginally deflationary 13% salary cost inflation in across 2024, expect mid Depreciation, single-digit LFL input cost 5% 2024 inflation in 2025 People, Expect circ
Slide 12: Maintaining value leadership whilst recovering cost inflation
MAINTAINING VALUE LEADERSHIP WHILST RECOVERING COST INFLATION Great value key to our strategic YouGov BrandIndex – Value rating – rolling 12 week 38.3 purpose - scale and vertical 40.0 integration leveraged to keep 35.5 costs low 30.0 Prices comparable with grocery sector but for freshly-prepare
Slide 13: Significant capital investment in growth
SIGNIFICANT CAPITAL INVESTMENT IN GROWTH 2025 2024 2023 Plan £m Actual Actual £m £m New shops and relocations (fitting & equipment) 63.5 66.5 57.6 Shop fitting – refurbishment 17.5 19.1 14.3 Shop equipment (additional and replacement) 38.0 41.3 34.7 Supply chain 160.0 109.1 84.5 I.T. and other 21.0
Slide 14: New shop & relocation maturity delivering strong returns
NEW SHOP & RELOCATION MATURITY DELIVERING STRONG RETURNS New shop investment achieves two 40% Whole Estate objectives: 35% 2021 cohort 1. Extend access to Greggs in under- 30% represented locations Target cash ROI% ‒ Strong returns, pipeline profile 25% marginally better returning than core 2022 coh
Slide 15: Creation of 3,500-shop capacity in supply chain
CREATION OF 3,500-SHOP CAPACITY IN SUPPLY CHAIN Additional savoury Fit-out of Derby site, due to production line and 2x open in 2026. Capex reduces beyond £m £m DC extensions. Kettering land purchase investment phase 350 Commencement of and building ahead of 2027 1400 works at new Derby site opening
Slide 16: Expected phasing of new sites
EXPECTED PHASING OF NEW SITES H1 2025 H2 2025 H1 2026 H2 2026 H1 2027 H2 2027 Building fit-out Production go- Derby Logistics go- live Q4 2026 Install logistics automation live Q2 2026 Lease value/term Annualisation of additional fixed = £47m / 25yrs Install 1st production line Additional costs and
Slide 17: Tax, EPS, dividend
TAX, EPS, DIVIDEND Taxation Underlying tax rate in 2024 25.7% (2023: 24.4%), y-o-y movement reflects increase in the headline rate of Corporation Tax to 25% Overall effective Corporation Tax rate of 24.8% including exceptional gain (2023: 24.3%) Forward guidance – 2024 to 2026: 26.0% (based on
Slide 18: Balance sheet
BALANCE SHEET Cash Net cash inflow from operating activities after lease payments £254.2m (2023: £257.1m) £125.3m net cash position at 28 December 2024 (2023: £195.3m) Strength of cash generation reflects growth in profits and the sale of legacy supply chain site in the year Elevated level o
Slide 19: Operational and strategic review
OPERATIONAL AND STRATEGIC REVIEW ROISIN CURRIE CHIEF EXECUTIVE
Slide 20: A winning strategy
A WINNING STRATEGY BROADENING DEVELOPING THE EXTENDING EXPANDING DIGITAL CUSTOMER APPEAL GREGGS ESTATE EVENING TRADE CHANNELS SUPPORTED BY INVESTMENT IN SUPPLY CHAIN, TECHNOLOGY AND SUSTAINABILITY 21 20
Slide 21: Menu innovation supports all day parts and channels
MENU INNOVATION SUPPORTS ALL DAY PARTS AND CHANNELS New over-ice drinks range, including Iced Latte and Iced Cloudy Lemonade, proving popular with customers and available in 1,175 shops ‘Ready-to-Drink’ Latte and Caramel Latte canned products launched Made-to-order hot food currently in 140 sh
Slide 22: Broadening customer appeal
BROADENING CUSTOMER APPEAL Maintained #1 position for food-to-go breakfast visits* Aim is to reach all food-to-go consumers across the UK throughout the day Continued to be ranked #1 in YouGov's Brand Index within the QSR, coffee shop & delivery services sector Popularity of the brand allows
Slide 23: Structural repositioning of the Greggs shop estate
STRUCTURAL REPOSITIONING OF THE GREGGS SHOP ESTATE Our estate in 2014 Net openings (10 yrs) Our estate in 2024 9% 6% 3% 12% Transport and other 168 27% 1,650 City, towns & suburbs -12 2,618 shops Retail parks and supermarkets 190 shops 9% 52% 82% Roadside (inc drive-thru) 622 Roadside (inc drive-thr
Slide 24: Material growth opportunity ahead
MATERIAL GROWTH OPPORTUNITY AHEAD Still increasing density in heartland areas, and material opportunity to grow shop numbers in other parts of UK Record 226 new shops in 2024 (145 net of closures and relocations), planning for 140 to 150 net openings in 2025 144 out of 226 new shop opening wer
Slide 25: Developing the Greggs estate
DEVELOPING THE GREGGS ESTATE Relocations and refurbishments add capacity and capability to service new channels Relocated a record 53 shops in 2024. Relocated shops see an average 30% increase in sales* in the year after relocation Targeting > 50 relocations in 2025 Refurbishments also suppo
Slide 26: Evening trade
EVENING TRADE Further good growth, post-4pm remained fastest growing daypart in 2024 Evening trade represented 9.0% of company- managed shop sales in 2024 (2023: 8.5%) Existing favourites such as chicken goujons and pizza slices proving popular Launched a BBQ Chicken & Bacon pizza and comple
Slide 27: Digital channels
DIGITAL CHANNELS 1,556 shops now offering delivery (2023: 1,440). Delivery now 6.7% of company- managed sales (2023: 5.6%) Delivery sales up 30.9% in 2024 following roll out with Uber Eats Strong growth in use of Greggs App as customers value rewards for loyalty – 20.1% of company-managed tran
Slide 28: Investing in supply chain and technology
INVESTING IN SUPPLY CHAIN AND TECHNOLOGY Supply chain capacity expansion: ‒ fourth production line at Balliol Park site in Newcastle, boosting production capacity for savoury rolls and bakes by 35% ‒ redevelopment of Amesbury and Birmingham distribution centres, increasing logistics capacity by 30
Slide 29: The Greggs Pledge
THE GREGGS PLEDGE TEN COMMITMENTS TO HELP MAKE THE WORLD A BETTER PLACE BY THE END OF 2025 AND BEYOND Stronger, Safer Better Healthier Planet Business Communities 29
Slide 30: 2024 Pledge highlights
2024 PLEDGE HIGHLIGHTS 1,000 primary school Breakfast Clubs target met, feeding 75,000 children every school day 38 Outlet shops supporting increased redistribution of unsold food > 30% of range in Healthier Choice product classification 2040 net zero carbon target fully embedded into busine
Slide 31: Looking forward
LOOKING FORWARD Like-for-like sales in company-managed shops grew by 1.7% year-on-year in the first nine weeks of 2025 Challenging weather conditions in January followed by improved trading in February Strong pipeline of new shop openings as we pursue our ambitious growth plans and invest in t
Slide 32: Questions
ss GREGGS QUESTIONS