STRONG online and convenience stores’ performances helped supermarket giant Sainsbury’s outstrip City expectations today with a 5.4 per cent jump in half-time profits and 1.7 per cent underlying sales growth.
The result was seen as Sainsbury’s stretching farther ahead of some main rivals, with Morrisons posting third-quarter same-floorspace sales down 2.1 per cent last week and Tesco recently unveiling a 12.4 per cent slide in interim trading profits.
Justin King, Sainsbury’s chief executive, said: “Certainly, if you compare our performance with all our major competitors we’re doing the best both in sales and profit.”
He revealed that the group’s online sales rose more than 20 per cent in the 28 weeks to 29 September, as it also opened nearly 50 new Sainsbury Local convenience stores. King said online grocery orders were exceeding 165,000 a week.
That helped drive underlying pre-tax profits up to £373 million, compared to City forecasts of £371m and a profit of £354m made in the same period of 2011.
First-half total sales lifted 4 per cent to £13.4bn as Sainsbury’s outshone the market, increasing its share to 16.7 per cent – its highest for nearly a decade.
Analysts said the latest performance showed Sainsbury’s “Brand Match” money-off coupons, higher penetration of own-label food ranges and increased sales of non-food products were helping its resilience.
King said: “Whilst the wider economic situation remains challenging, we are well positioned.”
Asda is due to update on its third quarter today.
Sainsbury’s shares fell just under 8.5p to close at 338.75p. The stock is up 14 per cent over the past year, partly due to periodic speculation regarding a potential renewed takeover approach from the Qatar sovereign wealth fund, which owns 26 per cent of the company.