Shares of Newcastle-based bakery and food retailer Greggs rose about 10% on Wednesday after it published a trading update for the fourth quarter of 2020 showing it slowed down its sales decline caused by the coronavirus crisis.

Greggs, which cut 820 jobs late last year, said like-for-like sales at company-managed shops in the fourth quarter to January 2 averaged 81.1% of the equivalent 2019 level – an improvement on the 71.2% of its third quarter.

Greggs said it expects financial year 2020 total sales to fall to £811 million from £1.168 billion in 2019 and said full year loss before tax is expected to be up to £15 million.

Greggs said in its outlook: “Looking ahead, the significant uncertainty over the duration of social restrictions, along with the impact of higher unemployment levels, makes it difficult to predict performance. 

“However, we do not expect that profits will return to pre-COVID levels until 2022 at the earliest.”

Greggs CEO Roger Whiteside said: “Whilst the impact of COVID-19 has been enormous, we have established working practices that allow us to provide takeaway food services under the different levels of restrictions we have experienced. 

“The breadth of Greggs’ customer base provides ongoing demand for our services which, combined with our diverse geographical spread, has demonstrated the resilience of our business.

“With customers spending more time at home we have successfully developed our partnership with Just Eat to offer delivery services and have also seen strong sales through our longstanding partnership with Iceland, offering our products for home baking. 

“We have resumed opening new shops where we see good opportunities, with those sites accessed by car performing particularly well.

“In light of the recent Government announcements significant uncertainties remain in the near-term. 

“We have taken action to position Greggs to withstand further short-term shocks and are optimistic about our prospects for growth once social restrictions are lifted.”