Welcome to the new Independent website. We hope you enjoy it and we value your feedback. Please contact us here.

Business News

Sainsbury's to push on with store openings


Sainsbury's has insisted that – unlike its big rivals – its rapid store-opening programme will not hit its performance as it posted a 7 per cent jump in half-year profits.

The UK's big four grocers – Tesco, Asda, Sainsbury's and Morrisons – will add 19 million square feet of new space between 2010 and 2014, which City analysts feel is excessive in a sector where sales volumes are declining.

But Justin King, chief executive of Sainsbury's, which aims to add 1.4 million square feet of space in 2011-12, said its plan was more balanced – in terms of proportion of new supermarkets, convenience stores, extensions and rebadges of acquired shops – than its rivals'. He added it was also "massively" more weighted towards opening new stores away from its existing branches, thus minimising the prospect of sales cannibalisation.

Mr King said: "Over a third of our space is more than eight miles from an existing [Sainsbury's] supermarket."

For the 28 weeks to 1 October, the company's underlying pre-tax profits rose 6.6 per cent to £354m. Boosted by higher fuel prices, sales were up 7.6 per cent to £12.9bn. Mr King said: "We remain a nose ahead of our rivals."

While Sainsbury's like-for-like sales rose by 1.9 per cent, they were flat once the impact of store extensions and VAT is stripped out.