Sainsbury’s has raised its profit guidance for the year after winning market share and volume gains in the first half.
Grocery sales rose faster than inflation at 2.9% to reach £13.2bn, reflecting “continued volume growth” and market share gains, the retailer told investors this morning.
Overall sales excluding fuel rose 2.6% to £14bn, with underlying operating profits up 3.6% to £525m for the 28 weeks to 12 September.
Reflecting the profit growth and Argos’ contribution to profits, now that it is marked for sale, Sainsbury’s has raised the bottom end of its profit guidance by £40m. It now expects full-year profits of between £1,025m and £1,065m.
The grocer’s volume gains had come thanks to a combination of product innovation and strong value, said CEO Simon Roberts.
“We know many households are finding things tough at the moment and we’re making it easier for customers to enjoy good food every day, whatever their budget,” he said. That’s why more people are choosing us for their weekly shop, driving continued volume growth in the first half.”
Nectar Prices, and what he claimed as the largest Aldi Price Match in the market, had helped to keep the retailer’s offer competitive for consumers, Roberts said.
“Innovation is powering our progress,” he added.
“We’re bringing more choice and exciting new food to customers and expanding ranges in more stores. Taste the Difference sales grew by more than 6% and our restaurant-quality Taste the Difference Discovery range will soon have 200 products. We’re also making healthier choices easy, affordable and delicious through our expanded Full on Fibre range.
“As we progress the sale of Argos and further sharpen our focus on food, we are building a simpler, more focused Sainsbury’s. With great value, outstanding quality and exciting new food across our ranges, we’re looking forward to helping customers enjoy a really special Christmas.”
More to come
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