Greggs (GRG) H2 2025 earnings summary

Executive summary

• Total sales reached £2,151.2m for 2025, up 6.8% year-over-year, with like-for-like growth of 2.4% in company-managed shops and 4.3% in franchise shops.

• Underlying operating profit and PBT were in line with expectations, with underlying profit before tax at £171.9m, down 9.4% year-over-year and operating profit down 4%.

• Market share of visits increased by 0.5 percentage points to 8.6%, outperforming a market that saw a 3% decline in visits.

• Continued estate growth with 121 net new shops opened, expanding reach into underrepresented catchments.

• The business continues to focus on value, innovation, and convenience, maintaining resilience in challenging market conditions.

Financial highlights

• Underlying operating profit margin declined by 1 percentage point to 8.7%; diluted EPS fell 10.7% to 122.8p.

• Gross margin remained stable at 61.5%, with balanced cost and price inflation.

• Operating cash inflow after lease payments was £273.7m, with net cash at year-end of £45.8m, supported by £25m drawn from the RCF.

• Ordinary dividend of 69p per share proposed, unchanged from the prior year, with dividend cover at 2x EPS.

• Exceptional items in 2025 included a £4.5m provision for historic VAT understatement.

Outlook and guidance

• Cost inflation expected to ease to around 3% in 2026, with food & packaging input costs seeing low single-digit inflation; wage inflation forecast at about 4%.

• Profit progress expected to be stronger in H1 2026, with a flat full-year outlook due to new Derby site costs in H2.

• CapEx to decrease to ~£200m in 2026, then to £150–£170m from 2027 onwards.

• Guidance for 120 net new shop openings in 2026, consistent with the prior year.

• Further growth contingent on consumer recovery.