Sainsbury Sales Up 3.1%

10/10/07 UK retailer Sainsbury’s has said that total sales for the second quarter were up 3.8 per cent (4.7 per cent excluding fuel). Like-for-like sales for second quarter was up 2.6 per cent (3.1 per cent excluding fuel). Justin King, chief executive, said: “We have delivered a good first half sales performance in line with our expectations for the current year despite the poor summer weather. The market remains competitive but our business continues to operate from a strong position, delivering growth and operational improvements each quarter. We remain ahead of our Making Sainsbury’s Great Again three-year target to grow sales by £2.5 billion by March 2008, having now delivered £2.3 billion of additional sales and we are confident in our ability to deliver the new space and sales growth targets which we outlined in May 2007.”

“We are pleased to report that like-for-like sales in the second quarter, excluding fuel, grew by 3.1 per cent. This result represents strong sales growth in a quarter with some very tough comparatives, particularly during the first six weeks where exceptionally warm weather helped to deliver additional growth across the business last year. Our two-year like-for-like growth remains at around ten per cent, building on the excellent results delivered last year. Total sales for the second quarter, excluding fuel, grew by 4.7 per cent as we continued to outperform the grocery market.

“Growth in customer transactions continues to drive an increase in customer spending. Volumes remained strong over the first half as we delivered like-for-like sales growth, excluding fuel, of 4.0 per cent, in line with our expectations for the current year.

“We maintained our competitive position during the quarter reducing prices on another 7,000 products and also reinforced our strong heritage in quality products, launching our ‘Different Values’ campaign. We are proud to announce that our entire range of own-brand tea will become 100 per cent Fairtrade over the next three years. This will make Sainsbury’s the UK’s biggest Fairtrade tea retailer and will triple Fairtrade tea sales in the UK. This is of a similar and significant scale as the conversion of all our bananas to Fairtrade, which was completed during this quarter. It will create an increased return of around 2 million each year for developing countries. The first tea to be converted will be Sainsbury’s Red Label tea, a 100-year-old brand, which still comes from the same supplier over a century later.

“We were delighted to be named ‘Supermarket of the Year’ for the second year running at the Retail Industry Awards last month. In winning this award we were acknowledged by the judges for being “at the leading edge of food”. We also received awards highlighting the achievements we have made within our fresh produce, seafood and beers, wines and spirits offering.

“We are increasing the capacity of our supply chain, enabling us to deliver greater operational flexibility and meet future volume growth. Our new depot in Northampton will open later this month. The depot is the UK’s most energy efficient distribution centre using half the energy of similar buildings. The environmental initiatives at the site include its own power plant providing a significant proportion of the electricity required for the depot and rainwater collection which will reduce water consumption by half.

“As announced last week, we will be relocating our store support centre to Kings Cross in London from early 2011. This move is driven primarily to remove unnecessary cost within the business and the transfer will significantly reduce our central office costs from 2011/12. The building will boast some impressive environmental credentials which support our aim to reduce energy use across our business.