Shares in J Sainsbury (LON:SBRY) have gained ground in London this morning as the blue-chip grocer reported a rise in sales and lifted its profit expectations. The company, however, noted market conditions remained challenging.
As of 08:35 GMT, Sainsbury’s share price had added 1.17 percent to 251.30p, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.20 percent higher at 7,746.86 points. The grocer’s shares have given up more than three percent of their value over the past year, as compared with more than a six-percent rise in the Footsie.
Sainsbury’s posts results
Sainsbury’s announced in a statement this morning that its like-for-like sales excluding fuel had climbed 1.1 percent in the 15 weeks to January 6. The group’s grocery sales grew 2.3 percent, with online and convenience sales up 8.2 percent and 7.3 percent, respectively.
Sainsbury’s noted that it now expected its full-year underlying profit before tax ‘to be moderately ahead of published consensus’.
“We’re pleased with our performance across the Group this quarter,” the blue-chip group’s chief executive Mike Coupe commented in the statement. Sainsbury’s, however, sounded a note of caution going forward, noting that market conditions remained challenging and that the company remained cautious about the consumer environment in the year ahead.
Analysts weigh in
“Sainsbury’s delivered a decent set of Christmas numbers with like-for-like sales growth a shade ahead of market expectations, but it still seems to be underperforming competitors in terms of sales growth in its core business,” Neil Wilson, a senior market analyst at ETX Capital, told City A.M., adding that “pressures remain and management stuck to the now de rigueur in retail updates mantra that the ‘market remains challenging’.”
Sainsbury’s update comes after peer Morrisons (LON:MRW) posted its results yesterday. Tesco (LON:TSCO) reports tomorrow.