Sainsbury's ups guidance as sales beat expectations
By Sean Farrell
Date: Tuesday 06 Jul 2021
(Sharecast News) - Sainsbury's increased its guidance for annual profit after sales beat expectations in the first 16 weeks of 2021.
Total sales rose 1.6% in the 16 weeks to 26 June from a year earlier as like-for-like sales excluding fuel also rose 1.6%. The FTSE 100 supermarket group said it expected annual underlying pretax profit of at least £660m compared with equivalent profit of £356m last year and earlier guidance of about £620m.
Grocery sales rose 0.8% as in-home consumption stayed high during continued Covid-19 restrictions. Sainsbury's said it performed better than competitors and gained market share after cutting prices and improving customer service.
General merchandise sales, including Argos, fell 1.4% from a year earlier but beat expectations, Sainsbury's said. Clothing sales rose 57.6%. Sainsbury's said it would make a further £50m of price cuts on food staples and essential items.
Sales of grocery, general merchandise and clothing were all higher than our expectations throughout the quarter," Sainsbury's said. "We now expect to report underlying profit before tax of at least £660m in the financial year to March 2022, with progress weighted towards the first half."
Sainsbury's shares were little changed at 278p at 08:22 BST.
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