The City anticipates that Sainsbury will continue its upward trend with its third single-figure improvement in a row, leaving the retailer on target to hit annual profits of between £250m and £280m.
“We’ve seen tiny tick ups in like-for-likes in the last year, with Sainsbury benefiting from Safeway and, to some extent, Asda,” said Jonathan Pitkänen, an analyst at Fitch Ratings.
“It’s now certainly spending the dosh to get things in order and I think its new ads are good.
“Like-for-likes will slightly improve, but you must remember they are coming off a low base. It’s still too early to be talking about anything big.”
Clive Black, analyst at Shore Capital, said Sainsbury’s chief executive Justin King had been making steady progress in turning the business around.
He added: “Petrol will have to be stripped out this time because of its volatility to give a true figure. Headline full-year profit is £280m, before £60m of operating exceptionals. I’d be surprised if it didn’t hit that.”
The results are likely to be buoyed up by the impact of the new £10m ‘Try something new today’ brand relaunch.
Sainsbury’s advertisements have dominated the papers since the campaign’s launch.