Sainsbury reports flat like-for-like third-quarter sales

8th Jan 2014 07:10

- Like-for-like sales flat- Total sales up 2.5 per cent- Growth in convenience and online sales- Customers expected to spend cautiously post ChristmasSainsbury reported flat like-for-like (LFL) sales in the third quarter as customers held back on spending ahead of the Christmas period.In a trading update for the 14 weeks to January 4th, the UK supermarket said total sales rose 2.5% in the face of challenging trading conditions. "This quarter has been characterised by a very tough sales environment throughout October and November, with customers saving up in order to treat their families over the Christmas period," Chief Executive Justin King said."However, we saw strong sales in the key period over Christmas, helping record numbers of customers to Live Well for Less."King said a 0.2% increase in LFL sales, excluding fuel, coupled with a strong contribution from new space, led to "our best Christmas ever".The seven days prior to Christmas was the busiest trading week with more than 28m transactions. The biggest trading day was December 23rd with customers spending nearly £17m.Own brand products performed strongly with the Taste the Difference range up 10%.The company sold more than 100,000 Taste the Difference fresh turkeys and turkey crowns, nearly half of which were Sainsbury's Norfolk Blacks.The Christmas food ordering service was more popular with more than 100,000 orders, up 24% year-on-year.Sainsbury's convenience business grew 18% and reached record sales on Christmas Eve of £7m. "This underscores how customers choose convenience stores to top-up their main supermarket shop, especially at the busiest times of the year," King said.Groceries online was up 10% during the quarter, and December 22nd was the strongest ever sales day, reaching over £5m. During the period the company launched a new groceries online website to allow easier navigation of items. The group also introduced an online delivery pass, which more than 10,000 customers have already purchased. The general merchandise and clothing business achieved record levels of market share, driven by tablewear, gifting, Christmas jumpers and onesies. Sainsbury is now the UK's sixth-largest retailer of homeware by value and the 11th-largest retailer of clothing by value.The firm added six new supermarkets, four extensions, and 19 convenience stores in the third quarter.Sainsbury continued to improve existing stores, refurbishing five supermarkets and 11 convenience stores in the quarter. The group said it is on track to deliver its target of around a million square feet of new space by the end of the year."As with last year, we expect customers to spend cautiously in the few months following Christmas, in an attempt to rebalance the household finances," King added. "The general economic backdrop remains uncertain for many families, so helping them to Live Well for Less remains the key to continuing our market outperformance."RD