Sainsbury’s might be outperforming rivals in the struggling supermarket sector, but HSBC’s analyst David McCarthy sees problems on the horizon ahead of Wednesday’s second-quarter trading update. He says trading in the latest quarter is likely to show improvement, with flat like-for-like sales compared with a 2 per cent decline in the first quarter and an overall sales rise of 1.5 per cent. However, he added: “This does not detract from the bigger strategic issues.”
He has slashed his profit forecasts by 6 per cent this year, by 9 per cent for next year and by a hefty 16 per cent for the year after, as Sainsbury’s will be hampered by the introduction of the living wage and continuing falls in underlying sales and margins as competition from the likes of Aldi and Lidl ramps up.
Tomorrow, annual results are due from plumbing supplies group Wolseley, struggling online fashion retailer Mysale (backed by retail tycoons Sir Philip Green and Mike Ashley), and embattled sofa seller SCS Group.
Revolution Bars, which runs the high-street cocktail bar chain, also has full-year figures out on Tuesday for the first time since its March float. In July, it revealed sales grew 3 per cent to £111.8m.
Tomorrow also sees half-year results from online clothing retailer Boohoo.com, whose share price has been recovering since January’s profit warning wiped 40 per cent off the company’s value in a day.
There are also first-half results due on Tuesday from Outsourcery, the company run by former Dragons’ Den star Piers Linney, and The People’s Operator, Wikipedia founder Jimmy Wales’ latest venture.
On Wednesday, over-50s insurer Saga is to unveil its first-half results, while a year-end trading statement from Topps Tiles is due.
Tesco’s general meeting to vote on the £4.2bn sale of its Korean Homeplus business is also scheduled for Wednesday.
On Friday bus-to-trains operator FirstGroup updates investors on first-half trading, while the September US non-farm payrolls report will be scrutinised amid uncertainty over the timing of a rise in US interest rates.Reuse content