Sainsbury’s benefited greatly from hot summer with total food transactions in the first half of the financial year up 0.6 percent, outperforming the market.
Grocery sales grew 1.2 percent and general merchandise sales, 1.5 per cent in the the 28 weeks to 22 September 2018, the supermarket chain said announcing interim results.
“Our strategy of offering customers a distinctive range of high quality and great value food has driven like-for-like sales growth at Sainsbury’s. Where we have invested to lower prices, volumes and transactions have increased,” said Mike Coupe, group chief executive of Sainsbury’s.
Groceries online grew nearly 7 percent and Convenience grew over 4 percent. Group sales revenue went up by 3.5 percent to reach £16.88 billion.
Group’s underlying profit before tax grew 20.3 percent, from £251 million to £302 million, mainly driven by Argos synergies delivered ahead of schedule. However, pre-tax profit almost halved from £220 million to £132 million, and profit for the financial period was down by 13 per cent, from £166 million to £144 million.
The group cited further non-underlying charges relating to restructuring our store management teams, Argos integration, Sainsbury’s Bank transition and the proposed combination with Asda for the profit decline.
The retailer maintained its profit guidance of £634 million for 2018-19 despite the “highly competitive and very promotional” nature of grocery, general merchandise and clothing markets.