It has been reported today that supermarket giant Sainsbury’s has seen a 17.9% drop in its first half-year profits to £308million, commenting that the market remains “particularly challenging”.
Figures show that like-for-like sales decreased 1.6%, with retail sales decreasing 0.1%, excluding fuel. Meanwhile, food sales were down 1% but clothing performed well with an increase of nearly 10%.
Commenting, Mike Coupe, chief executive, said that the grocery retail marketplace “remains challenging" but said he was "confident we are making progress" on its strategy.
He added: “"To complement our core food offer of great quality and inspiring food, sold at fair prices, we are delivering on our strategy to expand our non-food businesses with further growth in clothing, general merchandise and Sainsbury's Bank. Our strategy of investing to ensure customers can shop with us across multiple channels remains a strategic advantage. Shopping at Sainsbury's is now more convenient than ever for our customers and we are able to reward them for their loyalty.
"We continue to run the business efficiently and our cost savings programme is ahead of plan. We now expect savings of around £225 million by the end of this financial year and we are on track to deliver our target of £500 million cost savings over the next three years.
"The grocery retail marketplace remains challenging but Sainsbury's is a great business, run by an experienced management team, supported by talented colleagues and strong values. I am confident we are making progress and we are looking forward to a successful Christmas, offering our customers fantastic products and great value. We think our Orkney Island dressed crab, our Taste the Difference 18 Month Mature Cognac Laced Christmas Pudding, which recently won the Good Housekeeping 2015 taste test, and our stunning hand-finished Taste the Difference Golden Bow Fruit Cake will be customer favourites."
On the plus side, online grocery sales increased 7%, whilst convenience stores saw a rise of nearly 11%, making Sainsbury’s the only supermarket to see an increase in sales in the 12 weeks to October 11th, increasing its market share to 16.1% according to research from Kantar Worldpanel.
