Sainsbury’s has reported a fall in sales as shoppers cut spending amid mounting “pressure on household budgets”.
The company reported a 4% decline in like-for-like sales excluding fuel in the 16 weeks ended June 25 compared to the same period last year.
The slump was largely due to weak sales of general merchandise and apparel, which includes the Argos brand. Argos revenue fell 10.5% over the period.
Sainsbury’s also saw grocery sales fall 2.4% from a year earlier, which had benefited from pandemic restrictions that saw fewer people eating out at restaurants and cafes.
Simon Roberts, chief executive of the supermarket group, said the company was “working hard to reduce costs across its business”.
“We really understand how difficult it is for millions of households at the moment and that’s why we’re investing £500m and doing everything we can to keep our prices low, particularly on the products customers buy most,” he said.
“Pressure on household budgets will only increase as the year progresses and I am very confident that doing what is right for our clients and colleagues will be high on our agenda.”
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He said some branded shoppers are switching to Sainsbury’s cheaper own-brand alternatives.
Sainsbury’s said sales of beers, wines and spirits around the Queen’s Jubilee “were at an all-time high outside of Christmas and Easter, with Pimm’s, sparkling wine and champagne selling particularly well”.
The company also announced that fuel sales rose 48.5% over the period, driven by increases in the price of gasoline and diesel.
Automakers have criticized petrol retailers for failing to cut fuel prices despite falling wholesale costs in recent weeks.
Sainsbury’s said it still expects underlying pre-tax profit for the year to be between £630m and £690m.
Sainsbury’s sales fall as boss warns of ‘increasing pressure on household budgets’ | business news
Source link Sainsbury’s sales fall as boss warns of ‘increasing pressure on household budgets’ | business news