| UK

Gail’s robust trading steers UK outlet expansion drive

The UK bakery café chain says its UK store portfolio is its fastest growing and most profitable sales channel, strongly contributing to revenues of £62m ($76m) in the five months to February 2022

Gail’s will open its first store in the north west of the UK in early 2023 | Photo credit: Narain Jashanmal


 

UK-based Gail’s has cited the success of its growing outlet estate as driving sales earlier this year as it continues to expand its neighbourhood bakery model. 
 

The company’s sales in the five months ended February 2022 reached £62m ($76m), accounting for 73% of total sales for the previous 12 months


Sales from Gail’s stores contributed £45.5m ($55.8m) compared to £25.2m ($31m) from its wholesale division, which includes several UK supermarket partnerships.


The Bain Capital-backed business achieved adjusted group Ebitda of £3.8m ($4.7m) in the five-month period, with a pre-tax loss of £9.9m ($12m).  
 

'Over the period, trading was strong in part due to the wholesale business growing its retail channel, including with several large supermarket chains and the burgeoning consumer delivery operators. While cost pressures remain an ongoing focus, top line growth in both businesses remains the primary engine of the group’s profit and Ebitda performance. The retail business continues to be the fastest growing and most profitable. But the market also remains very competitive, and the group recognises that to be able to grow it must continue to provide innovative world-class food in attractive neighbourhood bakeries, the number of which are growing steadily,' the company said. 


Gail’s said it continues to monitor Brexit-related disruptions to its operations, predominantly increased supply chain costs and reduced labour availability. 


Additionally, the company said it had successfully adapted to Covid-19-uncertainties and expects its positive trading performance to continue unabated. 


The results, which cover the period before Russia’s invasion of Ukraine and subsequent energy price rises and supply chain disruption in the UK, show Gail’s was in a strong position at the beginning of 2022.  


The company, which reached its 100-store landmark in October 2022, opened seven new Gail’s bakeries in the reporting period as part of 33 new outlets planned for the full financial year, ending February 2023. 


Gail’s has also announced that it will open its first store in the North West of the UK in early 2023.   


The London-based company’s first outlet outside of the capital and wider South East region will be in Wilmslow, Cheshire. Further North West locations are expected to be announced in the new year.


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