Sainsbury’s has reported a fall in pre-tax profits despite growing sales, as conditions remain “challenging”.
Profits fell 1.4 per cent to £788m for the year to 16 March, while sales, including fuel, rose 4.5 per cent to £20/3.3bn.
The supermarket giant also confirmed that it will pay Lloyds Banking Group £248m for the remaining 50 per cent of Sainsbury’s Bank it does not already own.
Sainsbury’s Chief executive Justin King said the company’s performance was “good”.
In a letter written to shareholders he said: “With 33 consecutive quarters of like-for-like sales growth our market share is at its highest level for a decade and we are outperforming our major competitors”.
“Our clear and proven long-term strategy continues to drive good sales and profit growth.”
Around 50 per cent of the supermarket’s sales growth came from the online arm and smaller convenience stores, he said, with general merchandise and clothing growing at more than twice the rate of food over the year.
Underlying profits, which disregard the impact of property sales, beat analysts’ predictions with a rise of 6.2 per cent to £756m.
After negative speculation that he was about to stand down after nine years at the helm, Mr King said: “I still see myself as part of the future.”
Sainsbury’s, whose shares have climbed 24 per cent in the last 12 months, is the country’s third-largest supermarket after Tesco and Asda.
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