Management reshuffle as Sainsbury's profits slip

The new chief executive of Sainsbury's unveiled a shake-up of the company's management team today after seeing profits for the last year slide 2.9 per cent.

The new chief executive of Sainsbury's unveiled a shake-up of the company's management team today after seeing profits for the last year slide 2.9 per cent.

Justin King, who joined the troubled supermarket chain two months ago from the food department of Marks & Spencer, made his first move as Sainsbury's said underlying profits for the year to March 27 fell to £675 million.

The UK's former number one supermarket chain has seen its figures wilt in the face of stiff price competition from rivals such as Asda and Tesco, while it has also been hit by the impact of its own restructuring campaign.

Among management changes today, Stuart Mitchell will step down as managing director of the main supermarket business - a move that will enable Mr King to take control of the day-to-day running of the operation.

During the last financial year, sales at Sainsbury's core UK business increased 2.2% to £15.3 billion, but the figure was down 0.2% when viewed on a like-for-like basis. Operating profits were also 1.4% lower at £564 million.

The company said the lacklustre performance reflected a three-year modernisation programme, including an overhaul of IT and distribution systems.

Mr King said the focus was now on the customer: "The past three years have seen enormous change but we must now build on the investments made and refocus our attention on delivering a better offer for our customers.

"We know that the disruption of change has meant we have not served customers as well as we would wish and are committed to ensuring that customers see the benefits of our investments in the coming months."