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Upmarket bakery chain Gail's is planning to open 40 new stores in England over the next year, marking a major boost for the UK high street as it targets more locations outside London following a year of growing sales.

Gail's Bakery, which was launched on Hampstead High Street in 2005 by entrepreneurs Gail Mejia and Tom Molnar, is a shining example of London business success. The fast-growing chain said it wanted to continue expanding in areas across the country in the years ahead. It opened 36 cafes over the past financial year, including the first locations in the south west of England, and the next 40 are set to be opened by the end of February 2026.

Sales totalled £278 million in the year to the end of February 2025, up by about 20% compared with the prior year, recently filed accounts show.

But it revealed pre-tax losses widened to £7.8 million, from £7.4 million the year before, as it invested in new stores and therefore business expenses and staff costs rose.

Gail's had more than 4,000 staff at the end of February - about 500 more than the previous year following the recruitment drive.

It also has a wholesale business which sells baked goods to other stores and supermarkets such as Waitrose and Ocado.

Directors of the company said the wholesale market was "very competitive" but that it was attracting new and existing customers with high "quality at reasonable prices".

The price of Gail's sourdough loaf starts from about £4.80.

It said the retail arm - meaning its bakeries - was the "faster growing and more profitable part" of the group.

"But the market also remains very competitive and we recognise that to be able to grow we must continue to provide innovative world-class food in attractive neighbourhood bakeries," bosses added.