Sainsbury’s: Worst Christmas sales ever
Sainsbury’s says sales dropped during Christmas after general merchandise trading was hit by consumer caution and rigid competition from hard discounters like Lidl and Aldi.
The supermarket giant – which is planning to snap up rival Asda in a £12 billion deal – saw like-for-like retail sales fall 1.1% (Including Argos and excluding fuel) in the 15 weeks to 5 January.
Grocery sales rose 0.4% in the 15 weeks to 5 January, but this was offset by a 2.3% drop in general merchandise and a 0.2% decline for clothing.
Sainsbury’s are losing market share in speed
CEO Mike Coupe said Christmas “came late” as shoppers held off until the final weeks, while he warned over an “uncertain” consumer outlook.
The group said general merchandise sales, including its Argos business, grew “strongly” over the key Christmas weeks, but this was not enough to boost the overall performance.
“Clothing performed well, with strong full-price sales growth in a tough market. “Retail markets are highly competitive and very promotional, and the consumer outlook continues to be uncertain,” Coupe stresses.
The sales fall is worse than expected and comes in contrast to the 3.6% rise reported by rival Morrisons.
Industry data on Tuesday pointed to a tough Christmas for Sainsbury’s, with Kantar Worldpanel saying the chain was the worst performer of the Big Four with its market share dropping to 16.2% over the 12 weeks to December 31, down from 16.5% a year earlier.
Sources: Retailanalytics, Reuters, Bloomberg, Sainsbury’s, Tesco, Morrisons.