Sainsbury’s says its comparable retail sales jumped in Q1
- Sainsbury's total retail sales jumped 1.6% in Q1 on a year over year basis.
- The supermarket group expects £660 million underlying pre-tax profit this year.
- Shares of the company were more than 0.5% up on Tuesday morning.
J Sainsbury plc (LON: SBRY) reported an increase in its Q1 comparable retail sales on Tuesday. The £6.28 billion company also raised its full-year guidance. Shares of the company were more than 0.5% up on Tuesday morning.
Sainsbury’s sales in the first quarter
Sainsbury attributed its upbeat sales primarily to the grocery segment that benefitted from the continued COVID-19 restrictions, which fuelled in-home consumption. For the sixteen weeks that concluded on 26th June, the grocery chain reported a 1.6% annualised growth in its comparable sales, excluding fuel.
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Total retail sales, as per Sainsbury, also jumped 1.6% on a year over year basis on the back of a 29% increase in online grocery sales. In Q1, clothing sales climbed by 57.6% and total grocery sales by 0.8%. General merchandise, however, remained under pressure posting a 1.4% decline in the recent quarter.
In separate news from the United Kingdom, online grocer Ocado Group plc said its pre-tax loss contracted significantly in the first half of fiscal 2021. The company kept its full-year guidance unchanged on Tuesday.
Guidance for fiscal 2022
For the full financial year, Sainsbury forecasts a minimum of £660 million underlying pre-tax profit versus £586 million in fiscal 2021. The UK’s second-largest supermarket chain acknowledged that performance is likely to be weighed in H1. With COVID-19 restrictions continuing to ease and customer behaviour returning to normal, the pandemic-related boost to Sainsbury is expected to fade away in the future.
According to the London-based company, it launched 277 new lines in Q1, on track with its plan of introducing 1,900 new lines in total this year. Sainsbury rewards its customers for choosing healthier options (fruits and vegetables) when shopping for food. By 2025, it wants ‘healthy food’ sales to make up 83% of the total segment sales.