CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

Profits fall hurts Greggs stocks

Article By: ,  Financial Analyst
February 27, 2014 10:45 AM

A fall in profits badly damaged the share price of Greggs yesterday (February 26th), with the high street bakery chain losing nine per cent from the value of its stocks over the session.

Greggs announced that its pre-tax profits for the full year 2013 fell to £33.2 million, which was down from £52.4 million the previous year.

Chief executive Roger Whiteside stated that the company is going to focus on improving existing shops rather than opening new stores. It is also cancelling its attempted move into the coffee market under the Greggs Moment name.

He said: "2013 was a year of transition for Greggs as our new strategic focus centred on the growing food-on-the-go market. Whilst total sales for the year rose 3.8 per cent, like-for-like sales were down 0.8 per cent, reflecting the tough and competitive trading conditions."

Greggs moved its strategy back to selling takeaway food such as pies, pasties and sandwiches during the course of 2013, but still saw its profits for the 12-month period slip on the year before.

Positive outlook

Greg Bromley, retail consultant at Conlumino, told BBC News that the outlook for the bakery chain is "fairly positive". He said: "The bakery chain's poor like-for-like performance over the past year is primarily due to its battle with the weather, with snow early in the year followed by the heatwave in July proving disastrous for sales of its hot pasties and other baked goods."

Mr Bromley added: "It must continue to improve its food-on-the-go offering, as this is an area that is becoming ever more competitive as grocers and others weigh into the market."

While stocks in the company fell by nine per cent yesterday on the back of the falling profits announcement it made, the share price of Greggs had recovered slightly in the early stages of trading today. By 08:38 GMT, its stocks were almost one per cent up for the day, but this gain fell to 0.73 per cent by 10:14 GMT.

Find up to date information on the FTSE 100 and spread betting strategies at City Index

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024