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Sainsbury's sales trudge along despite bumper Christmas

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Sainsbury’s has released its Christmas quarter results, revealing minimal sales gains.

In the 15 weeks to January 7, the retailer's like-for-like were all but flat with a 0.1 per cent rise, and a total sales rise of just 0.8 per cent.

Despite disappointing overall results for the grocer, its non-food and convenience divisions’ results were more promising. Clothing sales were boosted 10 per cent while general merchandise also rose by three per cent.

Its online arm reported a nine per cent lift in revenue and its convenience stores posted a six per cent rise.

The grocer, which acquired Home Retail Group in a £1.4 billion deal last year, has since pumped money into incorporating Argos and Habitat into its retail network.

Argos also reported healthy total sales growth of 4.1 per cent and both reported a bumper Christmas period, with Sainsbury’s seeing a record 30 million customer transactions and £1 billion sales across the group.

Results from Morrisons were released on Monday, followed by Kantar Worldpanel’s market share report, which saw Sainsbury’s outpaced by its smaller rival posting growth of 2.9 per cent. 


READ MORE: Morrisons reports best sales in 7 years


Sainsbury’s also saw a market share loss of 0.6 per cent.

"The market remains very competitive and the impact of the devaluation of sterling remains uncertain," Sainsbury's Group chief executive Mike Coupe said.

Hargreaves Lansdown senior analyst Laith Khalaf added: “Argos pulled Sainsbury’s up by its bootstraps over the Christmas trading period, as the supermarket business failed to generate any sales growth on its own.

“However, against a backdrop of food deflation, flat sales are a pyrrhic victory for the supermarket, and represent an improvement on performance so far this financial year.

“Looking forward, 2017 promises to be a challenging year for the supermarkets, thanks to the falling pound, as they have limited scope to pass on the higher cost of imported food to customers in such a competitive environment.

“This currency crunch is likely to put pressure on margins, and profits.”

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Published on Wednesday 11 January by Ben Stevens

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