Sainsbury’s has record Christmas as it upgrades profits

 

 

Caption courtesy by Retail Gazette

By guest author Gemma Goldfingle from Retail Gazette

January 11, 2023

·      Sainsbury’s sales jumped 7.1% over the core Christmas period as it achieved a record Christmas performance

·      It benefited from shoppers hosting large gatherings at home.

Sainsbury’s profits for the year will come in at the upper end of expectations after it posted record Christmas sales.

Total sales jumped 7.1 %, with grocery sales also up 7.1 % in the 6 weeks to 7 January. This helped boost its third quarter performance, where like-for-likes sales jumped 5.9 %.

Although the grocer acknowledged that the sales rise did reflect the impact of inflationary price rises, it also said that sales volumes were “relatively resilient”.

Sainsbury’s boss Simon Roberts said it benefited from customers hosting larger gatherings again after Covid had led to a cut back in socialising over the past two Christmas and the fact that people were treating themselves at home.

Roberts said that households “managed their budgets differently” this year.

“Customers shopped early, buying Christmas treats and fizz more than once and looked for deals, taking advantage of Black Friday and other seasonal offers. Argos offered great value and quality and, as train and postal strikes disrupted the country, customers appreciated its reliability and convenience.”

General merchandise sales jumped a stronger than expected 7.4 % with Argos sales up 7.1 %  and Sainsbury’s clothing sales gowing 5.1 % over the core Christmas trading period.

Across the quarter, like-for-likes at the grocer, excluding fuel, jumped 5.9 % and grocery sales rose 5.6 %, or 12.5 % ahead of pre-pandemic levels.

Roberts said value was key over the period.

“We prioritised keeping our prices low and giving our customers great value at Christmas. We went bold on the traditional fresh turkey roast dinner with all the trimmings and dessert, which was the best value in the market at under £4 per head.

“Sales were also boosted by the World Cup as people celebrated more at home.

“Our determined focus on delivering the best value alongside new and exciting festive food plus outstanding customer service and availability meant we delivered record sales, and market outperformance at both Sainsbury’s and Argos.”

Roberts promised to help battle cost inflation and keep prices low in the year head.

“We understand money will be exceptionally tight this year particularly as many people wait for Christmas bills to land,” he said.

“We are working together with our suppliers to battle cost inflation and we’re keeping prices low again this year with our biggest value campaign yet in January, price matching Aldi on around 300 of our most popular products.”

Sainsbury’s now expects profits to be towards the upper end of its guidance of GBP 630 million to GBP 690 million.

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