Although Sainsbury recorded a £1m increase in underlying pre-tax profit from continuing operations to £118m in the 28 weeks to October 8, analysts had been expecting the figure to be just over £120m.
Many analysts downgraded their full-year forecasts for the retailer by £10m to £270m and their forecasts for 2006-7 to £335m.
They also expressed concern about Sainsbury’s banking business which recorded a half-year loss of £5m, tough market conditions and the rising cost of fuel, wages and rates.
One analyst said: “This is not the set of results on which to judge them. It will be next year when they face the task of reducing cost base while maintaining sales growth at the front end.”
Another added: “I don’t mind that sales growth hasn’t dropped through the bottom line. If they deliver solid like-for-like growth for two years, the bottom line will look after itself.”
Sainsbury also recorded a 5.6% increase in sales to £8.8bn and a 2.1% increase in like-for-like sales excluding petrol.