The high street baker Greggs has reported there was a 14% fall in pre-tax profits in the first six months of 2025 as the weather kept customers away.
For the past 4 to 5 months many parts of the UK has been hit with heatwaves and this has kept most away from the high street.
Retail is already facing a challenging consumer environment as there are fears of further tax hikes by the Chancellor in the upcoming Autumn Budget.
Greggs said in the first six months to end of June profits fell to £63.5 million compared to £74.1 million the year before.
The bakery chain said total sales increased 7% to £1.03 billion, like-for-like sales rose 2.6% and franchise locations grew by 4.8%.
The fall in profits “reflected challenging market footfall and the phasing of cost headwinds that have particularly impacted the first half of the year.”
Greggs said, “These challenges were compounded by heavy snow and strong winds in January and unusually hot weather in June, which had a material impact on consumer behaviour and lowered like-for-like sales.”
Mark Crouch, market analyst at eToro, said, “Greggs’ 14% drop in first-half profit caps a bitter 10 months for the UK’s favourite baker.
Management blames hot weather for weaker sales, but that doesn’t account for a 50% collapse in market value. The more plausible culprit is the timing of Greggs expansion strategy, stretching margins, just as the consumer picture turns more fragile.
“Greggs has long been a reliable read on the UK high street. Its sudden stumble suggests consumers may not just be cooling on sausage rolls, but that appetite across the high street may be waning more broadly.
With inflation easing and real wages recovering, the macro backdrop should, in theory, be supportive. That it isn’t showing up in Greggs’ numbers, is a red flag.
“Greggs’ brand still holds a strong place in the market, but scale isn’t helping if margins and volumes can’t keep up. The pressure is now squarely on management to regain the initiative, and not just blame it on the weather.”
