Greggs has announced that it is putting plans for a £30 million frozen food factory on the backburner, despite claiming previously that the facility would be one of the keys to expanding the business by establishing supply chains with supermarkets.
In a conference call to analysts and the media, boss of the high street bakery Roger Whiteside said that the Hinckley unit will be shelved, ending hopes of the creation of around 300 jobs.
Speaking to Food Manufacture, he added: "We managed to contain the costs to just about £0.5 million, as we had made no physical commitment beyond paper planning."
Mr Whiteside went on to say that Greggs was still looking to develop its frozen food distribution base which would provide its stores with greater supply flexibility. The organisation could also look to take packaged frozen food supply chains to a wider domestic retail and export market in the future.
The announcement came as Greggs announced its results for the first half of 2013. Like-for-like sales, excluding new outlets, dipped by 2.9 per cent with the company blaming the cold weather at the start of the year and the recent heatwave during July for lack of demand.
Half-year profits fell by £4.6 million to £11.4 million, while annual profits are now expected to be £3 million lower than previously expected.
"We will spend the next two to three years reshaping the business as we build the platform for long-term sustainable profit growth," Mr Whiteside said.
As part of its short-term plans, Greggs plans to focus on improving existing stores rather than opening new ones, with refits expected to take place in 240 stores over the next 12 months.
A customer loyalty scheme will also be launched to try to win more customers, it was revealed.