Greggs to hand out record £20.5 million to staff but shares slump on sticky outlook

The group, which has more than 2,600 outlets across the UK, saw its full-year revenues jump 11.3 per cent to a fraction over £2bn, partly driven by the opening of about 225 shops during the year, a record amount for the business.

Excluding the impact of new openings, sales grew 5.5 per cent compared with the prior year, which reflected longer opening hours in some shops and the roll-out of delivery services, but weighed down by a generally tougher market over the second half of the year. Greggs said many customers were continuing to worry about the cost of living including energy prices, mortgage and rent costs.

Despite that, the chain was forced to hike the prices of some of its food items last year - most recently, the national price of its traditional sausage roll increased by 5p to £1.30, while other items such as coffee and doughnuts rose by between 5p and 10p.

Greggs generated a pre-tax profit of £203.9 million for the year, 8.3 per cent higher than in 2023. About 10 per cent of this will be shared among eligible employees - those who have worked for Greggs for at least six months - through the group’s profit-share scheme. This means it is dishing out a record £20.5m this month.

Chief executive Roisin Currie said long-serving staff - those who have done more than six years service and work more than 20 hours a week with the chain - will get around £850 extra at the end of March.

She also noted that consumer confidence remains low into 2025, while there was an ongoing trend of people “saving more than spending”.

“It's been a challenging winter and I think we’ll continue to see that for the time being, and as we go through this year hopefully consumer confidence starts to strengthen,” Currie added.

She said the group raised prices to help mitigate the impact of wage increases, having upped the salaries of a large proportion of its staff at the same time. Prices have not changed since then and she insisted there were no “firm plans” for further increases, although she added: “Unfortunately we have stayed in an inflationary environment, so therefore we have to make sure we react appropriately across the balance of the year.”

A final dividend of 50p per share has been recommended, making a total ordinary dividend per share of 69p, up 11.3 per cent from 2023.

John Moore, senior investment manager at wealth firm RBC Brewin Dolphin, noted that on the face of it, Greggs had served up a strong set of numbers, with “solid increases” across all key financial metrics.

But he added: “As we saw with the baker’s last update, behind those headline figures there are concerns about the slowing rate of growth, particularly on a like-for-like basis. Add to that the increase to national insurance contributions from April and stubborn inflation, and you can see why some believe Greggs is in a sticky situation at the moment.

“But the business has shown time and again it can overcome challenges and surpassing £2bn in sales demonstrates how far it has come in the past decade. Greggs is still growing at a decent rate and, with plenty of cash in the bank, it has the opportunity to invest at a time when others may struggle to do so.”

Shares in Greggs were down heavily in morning trading, falling by more than 10 per cent.

Matt Britzman, senior equity analyst at investment platform Hargreaves Lansdown, pointed to a number of “challenges on the horizon” for Greggs, which can trace its roots back to 1939 and is headquartered in Newcastle upon Tyne.

He said: “2024 was a year of highs and lows for sausage roll maker Greggs as it surpassed £2bn in revenue for the first time, though conditions deteriorated over the year. Greggs has limited influence over consumer sentiment but continues to perform well in a tougher environment, with its value-focused offering helping to maintain market share.

“However, 2025 is shaping up to be a tricky year; consumers are hardly flush with cash, and costs are set to rise as Rachel Reeves’ Budget measures take effect. It’s good news, then, that the company’s growth engines - store expansion, delivery options, evening trade and digital channels - are all showing continued momentum, giving investors some hope that Greggs can keep pushing forward despite sector headwinds.”

Russ Mould, investment director at AJ Bell, noted: “Greggs is suffering from a serious slowdown in growth. Miserable weather was blamed for a poor start to 2025 and a cautious consumer is not going to help its cause.

“Greggs is doing everything it can to stay on top, such as through further menu innovation. There is a danger that Greggs is moving too far away from the products that drove its success, namely sausage rolls and Belgian buns. Burgers, pizzas and chicken goujons make Greggs more of a direct rival to kebab shops that are ten a penny across the country. Domino’s Pizza is also pushing hard on lunchtime wraps meaning the food on the go market is becoming dangerously crowded.

“Shoppers want good value for money in the current economic climate and Greggs might find its products are pushing above the price point at which people don’t blink to buy,” he added.

Greggs raises prices across menu after yearly sales top £2 billion