Improved trading in recent weeks helped by product innovation Greggs provided a trading update for the first 20 weeks of 2025 this morning. Company-managed LFL sales were +2.9% in the period. This compares to +1.7% reported for the first 9 weeks, implying growth accelerated to +4% in the most recent 11-week period. Total sales were +7.4% for the 20 weeks. Helped by better trading conditions, the Group notes product innovation has also been a key driver with over-iced drinks, new hot options including the recently viral, Mac and Cheese and Veggie savoury bake. Outlook / Guidance unchanged In terms of outlook, the Group notes the Group’s improved LFL performance is despite a still challenging market backdrop. Overall, its expectations are unchanged for both the FY outcome and cost inflation which is anticipated at c.+6% yoy. In addition, it continues to anticipate net store openings of 140-150 for the year. We currently forecast Group company-managed LFL sales growth of 3.5% and 145 net new stores which drives 8.7% Group revenue growth to £2,189m. With EBIT margins -40bps to 9.3% and a significant step-up in finance costs related to new capacity plans, we model just 1.4% growth in PBT and EPS to £192m and 139p respectively. This compares to VA consensus for £2,175m revenue, £187m adj. PBT, and 135p adj. EPS. Goodbody view While not out of the woods with LFL volumes likely still marginally negative, this is clearly a step in the right direction from Greggs with improving LFL momentum and guidance / expectations for the FY reiterated. With shares -28% ytd and trading on just 14x cal.25 P/E (vs. c.19x historic average), we expect a positive reaction this morning, albeit with shares +19% since April lows, there may have been an element of travel and arrive ahead of today’s update.