Sainsbury’s is ‘big enough’ to deliver Christmas cheer
SAINSBURY’S expects this year’s Christmas to be bigger than usual, and is confident the supply chain crisis will not affect customers’ celebrations.
Chief executive Simon Roberts said the supermarket can cope with global supply challenges and labour shortages affecting transport and warehousing.
And provided there are no new Covid restrictions, he said he expects families to splash out this Christmas as they make up for not being able to celebrate together last year.
However, he admitted ongoing supply issues had affected the first-half performance of its Argos division, where sales fell
7.3 per cent year-on-year.
He warned that there could be shortages of consumer electronics like tablet computers and toys.
Mr Roberts said: “Our industry faces labour and supply chain challenges.
“However, our scale, advanced costsaving programme, logistics operations and strong supplier relationships put us in a good position as we head into Christmas.”
Sainsbury’s made a pre-tax profit of £541million for the six months to September 18, compared with a loss of £137million for the same period last year. Its revenues were 5.3 per cent higher at £15.7billion.
Mr Roberts attributed the return to profitability to lower restructuring costs and write-offs, as well as a £168million windfall from payment card network operators.
The groups paid up to settle legal claims they had overcharged the supermarket for processing payments.
Grocery sales at Sainsbury’s grew 0.8 per cent to £11.3billion during the first half and it gained market share.
Mr Roberts said this was due to investing money saved from cost-cutting in lowering its prices on key lines. Sales at Argos, however, were down 7.3 per cent for the half due to supply issues, as well as the unseasonal weather Britain experienced and lower demand for home office equipment and technology compared with last year.
Overall, general merchandise sales were down 5.8 per cent to £3.1billion.
However, clothing sales boomed with the end of lockdown restrictions, growing 33.6 per cent during the first half to £500million.