Sainsbury’s reports a drop in first quarter sales, with the Argos business showing a fall of over 10%.
Sainsbury’s said that sales fell 4.5%, excluding fuel, in the quarter to June 25th, with general merchandise sales plunging 11.2%. The company said trading was in line with expectations and its underlying pre-tax profit guidance remained unchanged at between £630m and £690m.
Argos sales fell 10.5%, while Sainsbury’s general merchandise showed a drop of 14.6% and clothing was down 10.1%. Sainsbury’s grocery sales fell 2.4% year on year, although the company emphasised this was pitched against sales that were elevated during Covid, and said sales were 8.7% ahead of pre-pandemic levels.
Sainsbury’s said it was working to reduce costs right across the business, to enable investment in areas of most importance to customers.
Chief executive Simon Roberts warned that sales across the business were seeing the effects of a squeeze on cost of living and commented: “The pressure on household budgets will only intensify over the remainder of the year and I am very clear that doing the right thing for our customers and colleagues will remain at the very top of our agenda. We really understand how hard it is for millions of households right now and that’s why we are investing £500m and doing everything we can to keep our prices low.”
However, Simon reported that strong delivery of the retailer’s long term plan meant that the company had outperformed the market at certain key events such as the Jubilee, and added: “Our customers are watching every penny and every pound but they also look to Sainsbury’s when they want to treat themselves, particularly at special occasions.”
The business also revealed that commercial and retail finance director Bláthnaid Bergin will be promoted to succeed CFO Kevin O’Byrne, who has decided to retire in March next year after six years in the role.