Sainsbury’s sales rise but fuel costs bite
UK SHOPPERS are spending £10 per week less on food now than two years ago because of the cost of petrol, Sainsbury’s chief executive Justin King (pictured) warned yesterday, as the supermarket said sales rose 0.9 per cent in the past quarter.
Sales excluding petrol but including VAT rose 1.9 per cent, while sales ex-VAT were about one per cent less.
Fuel purchases now accounted for three per cent of all Sainsbury’s sales. “It’s punching a real hole in customers’ weekly budgets,” King said.
The performance beat rival Tesco’s 0.1 per cent sales fall in the period, but Sainsbury’s still missed consensus expectations of 2.1 per cent growth excluding fuel.
King outlined a number of signs that customers were struggling to pay for their food shop. Customers bought more of Sainsbury’s own-brand ranges and products included in meal deals. Sales of items named in its “Feed your family for £50” budget programme had jumped more than a fifth, he said.
Convenience store sales also rose 20 per cent as people spent less on the weekly shop but “topped up” with extra purchases during the week.
He said Sainsbury’s non-food sales were growing at twice the pace of food products, and it was extending stores to add more non-food space.
“The backdrop for non-food sales has never been more challenging,” he said, but added that as a single-destination shop Sainsbury’s could attract sales.
RESULTS IN NUMBERS
Group sales up 7.3%
Like-for-like sales excluding fuel and VAT up 0.9%
Weekly transactions up 5% to £22m per week
Fuel accounted for 3% of total sales
Convenience store sales up 20%