Simon English: The City has its doubts about King Justin
Thursday 12 January 2012
Outlook Justin King is a brilliant retailer. Just ask him, he'll tell you.
Yesterday's trading statement saw the Sainsbury's chief executive at his most ebullient.
"Record breaking," purrs the statement. Sales up 7 per cent.
"Quite clearly that result places us as the Christmas winner in grocery," says the bouncy Mr King.
City analysts aren't entirely convinced. Once you take out VAT and store extensions, they say, the underlying sales growth is not much better than Morrisons.
Which is why the City isn't giving Mr King's shares much love lately.
"Hold" says Shore Capital. Of course, if you've been holding them since they were nearly £6 in 2007, that advice is starting to get irksome.
The case against Mr King is that he doesn't turn nearly enough profit on annual sales of around £23bn.
But let's not be mean spirited. When he arrived in March 2004 Sainsbury's was a mess. The shelves were sometimes half-empty and even those with an emotional attachment to the company were beginning to shop elsewhere.
It's now a serious competitor to Tesco, and Mr King, one of the longest-serving FTSE 100 bosses, is still up for it. Fair play.
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