Soaring prices and squeezed households budgets have led to a slump in half-year profits at Domino's Pizza - but a jump in sales for value bakery chain Greggs.
The UK pizza chain reported a 16.3 per cent drop in underlying pre-tax profits to £50.9m for the six months to 26 June after taking a hit from soaring costs despite raising prices for franchisees and introducing a delivery fee. The company is banking on a boost from the football World Cup at the end of the year.
Greggs saw sales leap 27.1 per cent in the 26 weeks to 2 July as customers turned to value meals amid the cost of living squeeze, but warned its own cost inflation could hit 9 per cent. Half-year profits remained largely flat year on year at £55.8m compared with £55.5m last year, due to the reintroduction of business rates, an increase in VAT and higher costs.
It is the latest sign that consumers are beginning to adjust their spending habits. A recent YouGov poll found more than one-third have been forced to reduce, or stop spending money entirely, on eating out and takeaways over the past six months, as a direct result of rising costs and inflation.
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