Greggs, Britain's biggest fast food chain, warned subdued consumer confidence meant profit would be flat this year, despite a pick-up in sales in its Christmas quarter, hitting its shares.
The bakery chain, known for its sausage rolls, steak bakes and vegan alternatives, reported underlying sales growth of 2.4% for last year, a decline from 5.5% in 2024 and 13.7% in 2023, and said consumers would continue to struggle this year.
"The mood music last year wasn't a positive one so I think that played into the consumer feeling under pressure," chief executive Roisin Currie told Reuters today.
"That's why we're being cautious about 2026."
Shares in the company lost 7% in mid-morning deals, having risen 25% in the run up to Christmas from a four-year low in November. Analysts said they would downgrade future profit forecasts after the update which was called "underwhelming" by Panmure Liberum.
In its Christmas quarter, Greggs posted underlying sales growth of 2.9%, improving from the previous period when they were up 1.5%, putting it on track to deliver 2025 pretax profit in line with a consensus forecast of £173m.
For 2026, Greggs is expecting profit at a similar level, and Currie said she expected new pizza flavours plus demand for Mac & Cheese and chicken goujons to help drive sales.
The slowdown at Greggs' has led some analysts to say that Britain may have hit "peak Greggs" after rapid expansion in recent years.
But the company has said it still planns to grow its footprint. It currently has 2,739 shops, compared to McDonald's which has more than 1,450.
