Sainsbury's toasts festive sales spurt

Sainsbury emerged as the festive winner among the supermarkets, reporting a 3.6 per cent rise in same-store sales for its third quarter, excluding fuel – comfortably ahead of City forecasts of about 3 per cent.

The retailer, led by Justin King, also highlighted the success of its "non-food" offering, which it said had grown at three times the rate of its food offering.

In the past month, Sainsbury's has overtaken Asda to regain its number two position among Britain's grocers, despite the latter's aggressive price-based promotions.

The grocer hailed the success of its ethical policy, with sales of free-range turkey up 30 per cent and smoked salmon up 16 per cent. It also toasted the £1bn relaunch of the quality "Taste the Difference" range. Mr King said: " This quarter is our 24th consecutive quarter of like-for-like sales growth. We started out with lots of bad things about this business, but now it is increasingly about making things better."

Mr King said that even with the current economic uncertainty, shoppers were still proving willing to pay for quality and had not abandoned their ethical ideals. But he also said the perception of Sainsbury as being slightly more pricey than some supermarkets because of its focus on quality was wrong.

"We are focused on quality and price and we grew throughout the downturn. We are much sharper on price than people give us credit for. I think the consumer has been misread. They have not abandoned their ethical principles because of the downturn and we are benefiting from our stress on this area." Sainsbury also said that 2,100 of the 20,000 people who were recruited for temporary roles at Christmas had been offered permanent jobs, "in addition to the creation of over 3,700 new jobs through our store development activity".

The retailer also highlighted its clothing ranges as showing "good growth", with lingerie and clothing accessories in particular performing well. Sales were better by more than 45 per cent on last year. The company said it had seen "strong growth" rates in its home and electrical ranges and sold one in every three copies of Shrek Forever After bought in shops.

Clive Black, analyst at Shore Capital, said of the figures: "Sainsbury has probably today confirmed that it has emerged as the 'winner' of underlying trading momentum of the 'big four' superstores in the UK over the festive period; only Waitrose (John Lewis Partnership) may have exceeded Sainsbury's momentum." Mr Black added that "more to the point", the retailer had turned in the performance despite "tough comparatives" during the third quarter of last year.

Tesco is the last of the big retailers to report. Its sales figures will be released today alongside those of a string of other high street giants.

Retail results: More winners than losers

Supergroup

Three more retailers proved yesterday that December's snow should not necessarily have damaged sales, piling the pressure on those chains which have blamed the weather for disappointing festive performances. They were led by Supergroup, the owner of the Superdry label, which said its Christmas sales were up 90 per cent. The figures were a boost to investors, who have seen the company's shares soar since last year's flotation only to fall back last month when the company warned that higher cotton prices might hit margins in 2011.

N Brown

The fashion retailer, which sells primarily through catalogues, said it had also beaten the snow, with festive sales up by 1.2 per cent.

Greggs

The baker had a decent season too, with booming mince pie sales boosting trade by 0.6 per cent, including a 16 per cent rise in the week before Christmas.

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