Sainsbury’s reports 15% online grocery growth, and good start for Tu website

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Sainsbury’s today reported strong online trading as it said its pre-tax profits for the year were likely to come in “moderately” ahead of expectations.

The supermarket, ranked a Model retailer in InternetRetailing’s IRUK500 research, said online grocery orders grew by more than 15% in the second quarter of its financial year, the 16 weeks to September 26. During that period it expanded its click and collect grocery collection points to 52 branches. Sainsbury’s also said the national launch of its Tu clothing website had been received well. “The first six weeks of trading,” said chief executive Mike Coupe in today’s trading statement, “significantly exceeded our expectations and the majority of customers are choosing to collect their orders in store.”

The online results came as Sainsbury’s reported a 0.3% rise in total retail sales for the second quarter, excluding fuel, while like-for-like sales for the quarter were down by 1.1% on the same basis. When fuel was included, total sales were down by 1.8% and like-for-likes down by 3.3%.

But the company said volume and transactions had grown as customers welcomed lower regular prices.

Coupe said: “During the quarter we saw an improvement in our key trading metrics. Both volume and transactions grew as the decline in average basket spend in supermarkets continued to stabilise. Whilst the market is clearly still challenging, with food deflation impacting many categories, we are making good progress on delivering our strategy.”

He added: “Year-to-date we have traded well, with both sales and cost savings ahead of expectations. Should current market trends continue, we expect our full-year underlying profit before tax to be moderately ahead of our published consensus.”

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