Greggs Shares Drop Amid Sales Slowdown

Greggs PLC's shares dropped over 10% following a report of slowing sales growth, with like-for-like sales increasing by only 2.5% in the last quarter of 2024 compared to 5% in the previous quarter. The company attributed this decline to weakened consumer confidence and reduced foot traffic in high streets, exacerbated by anticipated cost inflation due to rising employer taxes and minimum wage increases. Despite annual sales reaching over £2 billion, analysts have expressed concerns about Greggs' pricing strategy and potential impacts on its brand image, suggesting that the company may struggle to regain momentum in 2025. CEO Roisin Currie acknowledged a challenging market environment but emphasized that the company plans to open 140-150 new stores this year. Several brokers have downgraded their expectations for Greggs, with Deutsche Bank predicting an additional £97 million in costs over the next two years. Overall, the outlook for the upcoming year appears grim amid ongoing economic pressures.