The Sainsbury group – which included retailer Argos – reported a 26.8% fall in earnings per share to 17.5p, while underlying profit before tax decreased 1% to £581M. Total group sales, however, increased 11.6% to £26.2bn, the supermarket reported today (May 3).
Sainsbury attributed its robust food business result to its investment in quality, price and innovation.
Sainsbury group chief executive Mike Coupe said: “Food is the core of our business and we are committed to helping customers live well for less. Our food business remains resilient in a challenging market and we continue to innovate in quality and to invest in price.
‘A pivotal year’
“This has been a pivotal year and we have made significant progress delivering and accelerating our strategy. Sainsbury’s group offers customers market-leading product choice, value and convenience, whenever and wherever they shop with us.”
Price cuts and high street competition remained uncertain, but Sainsbury was well placed to navigate the external environment, it said.
Sainsbury’s own-label ‘by Sainsbury’s’ range has grown 2% in volume. Total transactions increased nearly 3% to 26M a week, it added.
The supermarket also removed multi-buy promotions in August 2016 to reduce waste at home and across the business, it said.
£500M cost saving programme
Sainsbury is on track to deliver its three-year £500M cost saving programme by the end of March 2018, with a further £500M cost savings by 2022, it said.
“We benefit from a strong balance sheet and have reduced our net debt by £349M to £1,477M,” said Coupe.
“The quality and range of our products, combined with our market-leading service, availability and channels set us apart from our competitors. Our values support our growth and our vision to be the most trusted retailer where people love to work and shop.”
Meanwhile, the UK’s leading supermarkets had their best year-on-year sales figures this year, even after excluding the impact of a late Easter, according to market researcher Nielsen.
- Total sales up 11.6%
- Profit before tax down 8.2%
- Earnings per share down 26.8%