After yesterday’s wretched M&S figures, a similar tale of woe from the supermarket giant would have brought some serious wailing and gnashing of teeth from the City. However, Sainsbury’s revealed this morning that like-for-like sales were up 3.7% in the 12 weeks to December 29, thanks to a strong Christmas showing. It’s the retailer’s 12th consecutive quarter of sales growth, and a step up from last quarter’s figure of 3.1%.
With total sales (including petrol and new retail space) up by a healthy 5.9%, CEO Justin King managed to hit his three-year target of growing sales by £2.5bn at the start of January – with three months still to go. So we’re guessing he’s in line for a tidy bonus at the end of March. It probably won’t be quite as much as he would have made if either of the two takeover bids had gone through, but it should still be enough to buy his family some nice Easter eggs.
Given that so many retailers have been feeling the pinch this Christmas, King was entitled to feel pretty pleased with himself this morning. But he resisted the temptation to crow. ‘This is a good result for the Christmas quarter, and is particularly pleasing given the level of competition during this period’, he said.
Some analysts had been worried that Sainsbury’s King revolution was losing its way, perhaps due to the takeover distractions of last year. But there was no sign of it over Christmas. More than 21.5m of us visited its stores in the week before Christmas, peaking on the Sunday, when 300,000 people were passing through the tills every hour. And the results were good across the board: the entry level ‘Basics’ range and the ‘Taste the Difference’ premium range were the top performers, showing that the chain is bringing in punters across the spectrum.
Still, we shouldn’t get too carried away, he warned. ‘Consumer budgets are clearly under pressure and we expect the market to continue to be very competitive,’ he said this morning – though he’s convinced that the improvements he’s made in the last few years will help Sainsbury’s weather the storm.
Then again, that’s what Sir Stuart Rose said yesterday, and it didn’t do M&S much good this Christmas...