Sainsbury's rings up record sales

 

Supermarket giant Sainsbury's says it rang up more than £100 million in sales on Christmas Eve in a record-breaking festive trading week.

The chain reported like-for-like sales up 0.9%, excluding fuel, in the 14 weeks to January 5 after its strongest ever performance in the week before Christmas, when it also notched up £16 million in one hour on Sunday December 23.

Sales growth slowed on the 1.9% reported the previous quarter and against last year's 2.1% rise over the Christmas period.

But the performance confirms the pressure on smaller rival Morrisons, which disclosed a 2.5% slide in Christmas sales earlier this week.

Sainsbury's was the only one of the "big four" players to increase its market share in the run up to Christmas, to 17.1% from 17% a year earlier, while Morrisons saw its share slip to 12%, according to data yesterday from Kantar Worldpanel.

Justin King, chief executive of Sainsbury's, said the group delivered good sales growth in "challenging" conditions.

"We expect the challenging economic backdrop to persist, with customers looking to re-balance their household budget after the festivities and so spending cautiously in the first few months of 2013," he said.

But the group said plans to continue its money-off coupon Brand Match scheme would help ensure it was "positioned to perform well over the next quarter".

Clive Black, retail analyst at Shore Capital Stockbrokers, said the figures implied a fall in sales volumes when factors such as inflation are stripped out.

But he said today's figures showed a "satisfactory performance in demonstrably dull market conditions".

Sainsbury's has reported resilient sales in recent months at the expense of its three main competitors, although figures tomorrow from market leader Tesco are expected to show a fightback at the chain with forecasts of a 1% sales rise.

Seymour Pierce retail expert Kate Calvert said it was likely Sainsbury's would "struggle to outperform in 2013" as Tesco is expected to reclaim recent lost sales growth.

Sainsbury's said non-food sales grew faster than food over its third quarter, with clothing sales up 10% year-on-year and small electricals sales rising by more than 24%.

Within food, the group saw own-brand product sales grow at three times the rate of branded goods as shoppers sought to cut down their food bill.

The firm's might in the convenience store sector helped sales from small stores rise more than 17%, while it added that online sales rose over 15%.

Ms Calvert said the performance at Sainsbury's confirmed that Morrisons is "structurally disadvantaged" by its lack of grocery delivery service and small number of convenience stores.

PA

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