MARKET REPORT: Bakery chain Greggs up 11% as vegan sausage rolls bring home the bacon

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The January launch of Greggs


Vegan sausage rolls are bringing home the bacon for Greggs, as the bakery chain posted ‘exceptional’ sales growth for the start of 2019.

Between the beginning of the year and February 16, total sales were 14.1 per cent higher than in the same period of 2018.

The January launch of its vegan sausage roll, already one of its five best-selling products, boosted sales. 

The publicity which the new meat and dairy-free roll garnered on social media, from outraged meat-eaters and enthusiastic vegans alike, also increased sales of normal sausage rolls and meat-based pastries, Greggs added.

The January launch of Greggs's vegan sausage roll, already one of its five best-selling products, boosted sales

The January launch of Greggs’s vegan sausage roll, already one of its five best-selling products, boosted sales

Like-for-like sales in the near-2,000 company-managed shops grew 9.6 per cent, and Greggs said its 2019 profit should now exceed expectations. 

Laith Khalaf, an analyst at Hargreaves Lansdown, pointed out that performance was strong last year too.

But he added that high expectations may already be baked into the share price, which is trading at a sizeable 21 times the company’s earnings. Greggs climbed 11.2 per cent, or 179p, to 1781p.

At the other end of the FTSE 250, drugs company Indivior, which makes treatments for heroin addiction, was sent spiralling lower as the US Supreme Court issued a decision against the Slough firm, which has been waging a long-running court battle to fend off competitors making copycat products.

Stock Watch – Patagonia Gold

Patagonia Gold’s shine was dulled as it announced the closure of one Argentine mine and the pause of operations at another.

The precious metals miner said the closure was due to lower than expected production. The other mine will be placed on care and maintenance – production there has also been below predictions.

Patagonia said it was still evaluating the development of other resources, but the shares tumbled 49 per cent, or 46.5p, to 48.5p.

The US’s highest court yesterday decided to allow competitors to sell their cheaper generic products in the country, a move which Indivior had challenged.

The drug in question, Suboxone Film, makes up 98 per cent of Indivior’s US revenue and the firm has already warned sales would slump if a rival was allowed into the market. In court papers it said: ‘An entire business, and the jobs and livelihoods that depend on it, will be in peril.’ Shares, already plummeting, ended down 11.4 per cent, or 13.5p, at 104.8p.

Online trading company Plus500 suffered more losses as it continued to reel from an accounting blunder last week. Hedge fund billionaire Crispin Odey, who had been selling down his firm’s stake in Plus500 when the stock was performing well, revealed he had snapped up even more cut-price shares on Monday.

The Brexiteer owned 9.7 per cent of Plus500 before the accounting error came to light, and now owns 16.2 per cent. The stock tumbled 10.7 per cent, or 86.5p, to 720p.

Britain’s FTSE 100 index fell by its largest amount in almost a fortnight, ending the day down 0.6 per cent, or 40.3 points, at 7179.17, pushed down by a stronger pound, which edged up against the dollar from $1.29 to $1.31 on hopes that Theresa May would soon make progress on a revised Brexit deal.

Regional rail and bus operator Go-Ahead motored higher on announcing it would make its first move into Manchester, buying the Queens Road bus depot from First Group. It will stump up £11.3million in cash for the depot and 163 buses, and shares climbed 1.5 per cent, or 27p, to 1877p.

Investors who took a punt on Manolete Partners when it floated last December have been rewarded.

The litigation finance firm said results for the year ending March 31 would be ahead of market expectations. Its shares shot up 7.9 per cent, or 21.5p, to 294p.

Shell’s oil and gas exploration director Andrew Brown, who is set to leave later this year, pocketed £1.5million as he cashed in 60,000 shares. 

At WH Smith, chief financial officer Robert Moorhead and his wife Erica sold 50,000 shares worth £1million and the finance director of its travel division, Graham Miller, did the same with wife Meryl, selling 10,000 for £204,000. WH Smith was flat at 2040p.

 



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