Losses at Argos, higher wages and a generally dismal end to the summer have hit half-year profits and sales at J Sainsbury (The Times £). Sainsbury’s has laid bare the challenges facing food retailers after profits tumbled by 40% while sales slowed amidst inflationary pressures and higher wage costs (The Telegraph). Sainsbury’s has unveiled a sharp fall in quarterly sales growth as it continues to struggle with rising costs and competition from discounters (The Financial Times £). Sainsbury’s shares slide after it reveals profit fall as wage inflation and supermarket price war take their toll (The Daily Mail). The group said losses at Argos, which it bought last year and has been integrating into its supermarket offering, higher wages and investment in price at its stores took their toll on underlying performance (Sky News).
Shoppers are not “pulling on the handbrake”, chief executive of Sainsbury’s Mike Coupe insisted as he blamed a soggy August for a recent slowdown in sales growth (The Guardian). The boss of Sainsbury’s has said the UK is “probably through the worst” of a weaker pound fuelling food inflation (The BBC).
The rising price of cream and butter sent profits back by almost three quarters at the spreads business of Dairy Crest, which produces the Country Life brand. Dairy Crest buys in the butter that goes into Country Life, leaving it susceptible to the open market price that has soared in recent months. (The Times £)
Retailers suffered their worst October for trading in more than a decade, according to a monthly sales tracker, adding to growing evidence that the high street has made a poor start to the final three months of the year. BDO, the accountancy group, which tracks weekly sales of 85 retailers with a combined portfolio of 10,000 stores, said that retail sales dropped by 5.2 per cent in October compared with a year earlier. (The Times £)
French billionaire Bernard Arnault has thrown his financial muscle behind an upmarket Danish bakery chain that is expanding across London. A private equity firm set up by Arnault and his luxury fashion house LVMH has taken a stake in Ole & Steen alongside existing backers Nordic Capital. L Catterton has bought 20% of the business, which was launched in Denmark but has recently been expanding overseas. (The Telegraph)
It may have lost the architect of its recent success, but Coca-Cola Hellenic Bottling Company said that it continued to build on the foundations laid by Dimitris Lois, its former chief executive, who died last month. (The Times £).