Sainsbury’s bosses have insisted that the supermarket is “not a rip-off retailer” as they faced scrutiny over the company’s profits in relation to the rocketing inflation of food prices.
The grocer also defended higher pay packages for its senior executives at its annual meeting in London on Thursday.
It comes two days after chief executive Simon Roberts said “food inflation is starting to fall” as Sainsbury’s reported a 9.2% jump in first quarter sales.
UK supermarkets have come under fierce scrutiny by the Competition and Markets Authority, which is investigating claims of profiteering from high food inflation in the grocery sector. Food inflation in May eased slightly to 18.4%.
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Speaking at the retailer’s AGM, chairman Martin Scicluna said: “To be very, very clear, we are not profiteering and we are not rip-off retailers.”
“We make 3p on every pound we sell. If we offered you something for £1, and I said I made 3p on that product, I don’t think you would call us a rip-off merchant or a profiteer, but some MPs have.”
Scicluna also defended the £4.95m pay packet awarded to Roberts last year – which included £3.96m in bonuses on top of his £899,000 a year salary.
“What we are trying to do is focusing on rewards for Simon, the operating board, senior leadership and colleagues. That’s why our colleague pay has gone up 44% over the past four years,” said Scicluna.
“It is a lower fixed pay, around 19% of the total, but we incentivised Simon and the team with the bonus and LTIPs [long-term incentive payments] to make sure that we grow profits, because it is good for the company and means we can invest in innovation, technology and reward shareholders.”
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