Greggs (GRG) posted a record performance in 2019, with like-for-like sales at company-managed premises up 9.2 per cent against a strong prior-year performance. The food-to-go company updated its profit guidance several times over the course of 2019 and has now boosted its dividend by more than a quarter, to 44.9p a share. The baker is throwing off cash, so it has significantly increased dividend payments, while allocating £49.6m in repayments on lease liabilities.
The phenomenal success of Greggs’ vegan range has fed into the surge in its share price in 2019. Concerns that growth will moderate have lingered, but the company is developing its reach, having recently signed with delivery service Just Eat.
Management is considering development “beyond the UK” by 2025, although there are no concrete plans. In the meantime, the company has continued its expansion in the UK, with 97 net openings in 2019, leading to a 35 per cent increase in net investment cash flows to £87.4m.
Consensus forecasts collated by Bloomberg give adjusted EPS of 96p and profits of £121m in 2020, compared with 90p and £114m in 2019.
| GREGGS (GRG) | ||||
| ORD PRICE: | 2,192p | MARKET VALUE: | £2.2bn | |
| TOUCH: | 2,190-2,194p | 12-MONTH HIGH: | 2,550p | LOW: 1,689p |
| DIVIDEND YIELD: | 2% | PE RATIO: | 25 | |
| NET ASSET VALUE: | 343p | NET DEBT: | 53%* | |
| Year to 29 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2015 | 0.84 | 73.0 | 57.3 | 28.6 |
| 2016 | 0.89 | 75.1 | 57.8 | 31.0 |
| 2017 | 0.96 | 71.9 | 56.6 | 32.3 |
| 2018 | 1.03 | 82.6 | 65.2 | 35.7 |
| 2019 | 1.17 | 108 | 86.2 | 44.9 |
| % change | +13 | +31 | +32 | +26 |
| Ex-div: | 16 Apr | |||
| Payment: | 21 May | |||
| *Includes lease liabilities of £276m | ||||
