SAINSBURY’S has predicted that grocery prices will continue falling into next year after suffering its sixth successive quarter of declining sales.
However, the group – which has 598 supermarkets and 714 convenience stores – insisted that investments in products and services would give it “resilience” amid the tough market.
Like-for-like sales at the UK’s third-largest grocer in the 12 weeks to 6 June fell by 2.1 per cent, having dropped 1.9 per cent in the previous quarter.
Chief executive Mike Coupe said: “Trading conditions are still being impacted by strong levels of food deflation and a highly competitive pricing backdrop.
“We will see price deflation continue until the end of this year, and into next year. This is good news for customers but puts pressure on our sales.”
Brewin Dolphin analyst Nicla Di Palma said: “Despite the difficult market conditions, management is confident that it is making good progress with its strategy. It continues to invest in the areas with the highest growth potential.”
Sainsbury’s reported its first annual loss for a decade last month, falling into the red by £72 million after writing down £628m on the value of its property estate.
Data published last week by researcher Kantar Worldpanel showed that smaller rival Morrisons was the only one of the “big four” chains to grow its sales in the 12 weeks to 24 May, with a rise of 0.1 per cent.
Sales at Sainsbury’s fell by 0.3 per cent, according to the Kantar figures, but the group maintained its share of the overall grocery market at 16.5 per cent.