Sainsbury's sees "strong" Christmas sales

Sainsbury's has proved expectations that it'd break its lengthy sales increase record wrong - just. The supermarket has announced like-for-like sales, excluding fuel, rose by 0.2 per cent in the third quarter, and said it saw "strong" sales in the run-up to Christmas.

This marks Sainsbury's 36th quarter in a row of like-for-like growth.

Chief executive Justin King said on the today programme this morning that, with economic conditions remaining tough, the retailer saw "people tightening their belts, ready to have a great Christmas".

But shares started to trade down this morning after chief financial officer John Rogers told reporters that like-for-like sales growth for the full year will "dip below" the one to 1.5 per cent range the company forecast in November.
Shares are currently down over two per cent, at 360p.

Total sales were up 2.5 per cent in the 14 weeks to 14 January but, including fuel, like-for-like sales for the period were flat.

A 2.5 per cent contribution from new space, with stores opening earlier than anticipated, meant sales performed above expectations, despite growth of only 0.9 per cent in the third quarter, owing to intensified competition over the Christmas period.

The store said the seven days before Christmas were the its "busiest ever" trading week.

Sainsbury's said its non-food offer continued to struggle because of the "tough economic backdrop", but it delivered growth ahead of expectations and over twice that of its food business.

New space, with stores opening earlier than anticipated, provided a 2.5 per cent boost to growth.

John Rogers commented that the company expected the economic climate to remain challenging, but the store will continue to up the pace of its convenience opening programme, along with taking full ownership of Sainsbury's Bank.

Chief executive Justin King said in the statement:

It has been a year like no other as we helped more customers than ever before to Live Well For Less.

With 33 consecutive quarters of like-for-like sales growth our market share is at its highest level for a decade and we are outperforming our major competitors.

Looking to the year ahead, whilst the economic climate is likely to remain challenging, we are well positioned to succeed for you, our shareholders, through the continued delivery of our long-term strategy for growth.