Greggs on a roll as profits return to pre-virus levels
INVESTORS snapped up Greggs shares after the budget baker said profits were set to return to prepandemic levels.
It upgraded its forecasts thanks to a strong recovery since shops reopened on April 12.
Sales at its 2,100 shops have been higher over the past four weeks than in the same period of 2019. In a trading update, it said the reopening of the wider High Street led to a ‘significant pick-up’ in business.
Profits this year will be similar to its performance in 2019 – when it made £114m. Such a result would be ‘materially higher’ than previously expected.
Customers rushed to shops, pushing footfall up by as much as 127pc week- on- week in some towns. Even before lockdown lifted, however, it had been helped by its move into food delivery, which it offers from 800 shops and makes up 8.2pc of sales.
Greggs shares soared 10.5pc, or 246p, to 2591p – sending the group to the top of the FTSE 250 leaderboard. Hotel Chocolat, meanwhile, was the biggest riser on the AIM 100 index after it too upgraded profit forecasts.
Sales in the posh chocolate maker rose 19pc in the eight weeks to April 2, compared with the same period of 2019. It said profits in the year to June 21 will be ‘significantly ahead’ of the previous estimate of £4m – and this will also allow it to hand back £3.1m of furlough cash and take on around 200 more staff this year.
Shares rose 10pc, or 35p, to 385p as founder and boss Angus Thirlwell said the chocolatier was ‘throwing the doors open and doing our bit to cheer up the population’.
London-listed funds that have given UK investors access to big Wall Street tech stocks had a more difficult start to the week.
Scottish Mortgage Investment Trust (down 6.2pc, or 75.5p, to 1139.5p), Baillie Gifford US Growth Trust (down 6.7pc, or 20.5p, to 287p) and Allianz Technology Trust (down 6.6pc, or 18.5p, to 264p) slumped as bigname groups including Tesla, Facebook and Alphabet fell, dragging the Nasdaq down by more than 1pc.
The wider market was also in the red, with the FTSE 100 finishing the first session of the week down 0.08pc, or 6.03 points, to 7,123.68, while the mid- cap FTSE 250 index fell 0.3pc, or 78.09 points, to 22,697.19.
Miners climbed as iron ore prices surged by 10pc to a record high.
Big iron ore diggers Rio Tinto (up 1.9pc, or 123p, to 6658p), BHP (up 1.6pc, or 38p, to 2375.5p) and Anglo American (up 0.8pc, or 27p, to 3408.5p) all rose as prices topped $226.
Self- storage group Safestore surged after reporting higher sales and bumping up its full-year earnings guidance. Storage revenue in the UK was up 14pc in the second quarter compared with the same period of last year.
Business has boomed since last March when people suddenly needed to free up space for home offices, many students were forced to study remotely and some companies gave up their offices. Safestore (up 8.2pc, or 71p, to 941p) has also signed deals for two sites in London and will extend two existing branches.
Elsewhere, a spike in deaths gave Dignity its best first quarter in three years. Weeks after a shareholder coup, the funeral provider said revenue jumped 14pc to £94.7m after 43,000 more people died in the first quarter than in the same period of 2020. But shares fell 2.6pc, or 19p, to 710p.
Superdry jumped again after an upbeat trading statement released last Thursday said revenues were rising and there was a ‘light at the end of the tunnel’ as pandemic restrictions unwind. The fashion group’s shares shot up another 15.7pc, or 62p, to 456p.