Sainsbury's shares closed unchanged at 319.75p after a bad-tempered analysts' briefing ended with Sir George Bull, the chairman, raising his voice and saying that he was hard of hearing and so unable to hear questions properly. "No one emerged with any credit from the meeting," one analyst said. "George Bull sounded more like a sergeant major than ever and the overall feeling was that there is no great clarity of thinking among the management team."
The comments came after Sainsbury's reported a 30 per cent fall in first- half profits to pounds 297m, though even this figure was boosted by a sharp fall in profit sharing payments to staff.
Like for like sales in the first half were down by 1.3 per cent on last year, well behind figures being achieved by Tesco and Asda.
Dino Adriano, chief executive, claimed the group was making good progress as it seeks to win back sales. He said the company expected to complete 22 store extensions and a similar number of refurbishments by the end of the year. The product range is being extended with an average of 250 lines added to every store between May and July. Other initiatives include rolling out the new brand identity, improving customer service and pledging to match the lowest local prices on 1,500 lines. He also said the group is looking at buying some of the Somerfield stores put up for sale earlier this month.
But Paul Smiddy, analyst at Credit Lyonnais, said: "They are still offering jam tomorrow. They may be able to tempt more people into their stores ...but that is not a very profitable way to operate."
Mr Smiddy cut his full-year profit forecast from pounds 610m to pounds 595m and predicted shares have further to fall. Analysts still questioned management changes announced last month, which will see David Bremner take control of the main supermarket business from the start of January with Mr Adriano remaining as group chief executive. When asked who would carry the can if Sainsbury's misses sales targets, Mr Adriano pointed at Mr Bremner but admitted that he himself would not escape blame.
Profits at the group's Homebase DIY business fell by 24 per cent to pounds 37m. This was largely due to the Easter holiday falling outside the period this year.
Sainsbury's Bank made a small profit of pounds 1m. Group sales were 4.5 per cent higher at pounds 9bn. The dividend was unchanged at 4.02p per share.Reuse content