The sandwich chain Pret a Manger has returned to profitable operations after two years in which it lost a cumulative £570m.
Announcing trading figures for the first six months of 2022, the company said its recovery had “continued and accelerated”, with half-year revenues more than tripling year on year to £357.8m, helping it return to profitability in March and becoming cashflow positive since May.
Demand in Pret’s home UK business has bounced back, although the coronavirus pandemic has changed the pattern of sales, with the strongest growth outside London.
There were “particularly strong regional and suburban sales”, it said, although a third of its 424 UK shops are still in the capital. After the opening of 27 shops this year it now employs 8,700 people in the UK, while across all of its operations it employs 11,500.
The chief executive, Pano Christou, said the company “grew fastest in some of the places where we only had a handful of Pret shops before”.
Pret’s sales slumped during the pandemic as workers were forced to stay out of town and city centres by lockdowns. It made a loss of £226m for 2021, after a £343m loss in 2020.
The chain’s reliance on city foot traffic was underlined once more by recent rail strikes, with trading in its City of London and Canary Wharf outlets falling to 62% of pre-Covid levels in the week the strikes began. Christou on Monday called for unions and train companies to agree a deal to avoid further rail strikes, saying it caused a “huge” hit to trade.
“It was a huge negative impact on business for sure,” Christou told PA Media. “Even the days in between were a lot quieter because services didn’t fully recover.”
However, the company, which opened in 1986, has bet that consumers will return to convenience food en masse after the end of pandemic restrictions in its major markets. It plans to double the size of the business within the next five years, including through international expansions such as a launch in India announced last week. The Indian outlets will be run by Reliance Industries, the fossil fuel and retail conglomerate owned by the billionaire Mukesh Ambani.
During the pandemic, Pret has been forced to call on £200m of financial support from shareholders including JAB Holding Company, a Luxembourg investment vehicle for Germany’s billionaire Reimann family who also own brands ranging from Dr Pepper drinks and Krispy Kreme doughnuts to perfume from Calvin Klein and Burberry.
Since September, Pret has signed deals to open shops in Canada, Ireland, Spain and Portugal, in addition to the India deal. As well as expanding geographically, Pret has been pushing into digital sales, including a coffee subscription that can be bought online. There are now more than a million subscribers a week, up from 667,000 in 2021, Pret said.
Christou also pledged further international growth, saying: “The opportunity now is for us to take that growth and apply it internationally.”
