It was a strong first quarter for J Sainsbury as sales beat expectations, with UK grocers rising a wave of stronger revenue fuelled by increasing prices – despite intense competition in the sector.
Like-for-like sales, excluding fuel, rose 2.3 per cent in the first quarter, better than the 1.9 per cent anticipated by analysts polled by Bloomberg and well ahead of the 0.3 per cent rise reported for the preceding quarter.
Total sales, also excluding fuel, rose 2.7 per cent in the sixteen weeks to July 1, up from 0.7 per cent in the preceding quarter.
Chief executive Mike Coupe said the group had “delivered a strong performance”. He added:
The market is competitive and we continue to manage cost price pressures closely. Our strategy is delivering and we are well placed to navigate the external environment.
Sales at British supermarkets rose at their fastest rate in five years over the past three months, according to data released by Kantar Worldpanel last week. However, all of the main grocers lost market share compared with last year due to competition from German value chains Aldi and Lidl, with the growth in sales stemming from increased prices. The strong performance for cheaper, non-branded goods in the data also suggested British consumers are increasingly feeling price pressures in their pocket.
Earlier this month it was reported that J Sainsbury has entered into exclusive discussions to acquire the convenience store operator Nisa for £130m. No comment on this was made in the statement.
Growth in Sainsbury’s sales was strongest in the clothing category, which rose 7.2 per cent in the quarter. Grocery sales rose 3 per cent.