Pret A Manger has slumped to a heavy annual loss after taking a £553m write-down on the value of its business, blaming higher UK costs and a more uncertain global economy. The coffee and sandwich chain, which operates more than 700 stores in 21 countries, posted an operating loss of £451.5m for 2024. That compares with a £28.3m profit a year earlier, despite group sales rising 10% to £1.2bn. Executives said the loss was largely down to the non-cash impairment, rather than day-to-day trading.
UK Budget Adds to Pressures
The company said the charge reflected the impact of last year’s Autumn Budget, which increased employer national insurance contributions and raised minimum wage thresholds from April. It also cited tougher global conditions and the use of a higher discount rate in financial modelling. Pret, which is majority owned by JAB Holding, carried £912m of goodwill on its books when it was acquired in 2018. With retailers bracing for further cost pressures in Chancellor Rachel Reeves’ upcoming November budget, industry groups have warned the sector is already stretched.
Pret’s Outlook
Chief executive Pano Christou insisted the write-down was not a sign of weakness in the core business. “It’s no reflection on how the business is doing as we look to now and in the future,” he said. Pret is pressing ahead with ambitious expansion plans, aiming to grow its UK estate from around 500 shops to 1,500 and to accelerate growth in the United States. Chairman José Cil added that the company was considering a stake sale or even a flotation: “There is potential for an IPO, certainly.”
Meal Deal Trial
Pret also confirmed it will test meal deals for the first time in the final quarter of 2025 in an effort to attract more lunchtime customers. The chain has not yet disclosed prices or which stores will take part, but the move signals a shift for a brand long positioned at the premium end of the market.
Competitive Landscape
The update comes as rival Costa Coffee faces its own upheaval. Coca-Cola, which bought Costa less than seven years ago, is reported to be exploring a sale. Costa operates more than 2,000 stores in the UK and over 3,000 globally, making it one of Pret’s largest competitors alongside Greggs and Starbucks in the battle for Britain’s lunchtime crowd.
