Champagne stays on ice at Sainsbury

15th Jun 2011 07:02

Supermarket group Sainsbury saw like-for-like (LFL) sales growth in line with management's expectations in the 12 weeks to 11 June, though the growth rate was below some brokers' estimates."We've delivered a solid sales performance, in line with our expectations, in spite of the continued tough consumer environment," said chief executive, Justin King. "Fuel price inflation combined with strong fuel volume growth resulted in an increase in total sales of 7.3%, with like-for-like sales up 4.8%. Excluding fuel, total sales were up 4.3%, with like-for-like sales up 1.9%," King added. Broker Nomura Securities had pencilled in year-on-year LFL sales growth of 2.3%, excluding fuel but including value added tax.Easter, the royal wedding and a hot April all played their part in boosting sales, with the group selling the most champagne it has ever sold outside of the Christmas period.The group echoed statements from rival Tesco on Tuesday that the increase in fuel costs is putting further pressure on consumer disposable income.Sales of general merchandise and clothing grew faster than sales of food. The convenience store business saw 20% total sales growth, as did the online groceries business.The market environment remains very competitive, however, and the company expects this to remain the case for the rest of the year. --jh