Sainsbury’s expects full-year profits to come in “moderately ahead” of consensus after posting an increase in sales during the golden quarter.
The supermarket giant said like-for-likes excluding fuel grew 1.1% during the 15 weeks to January 6, as total sales in its core grocery business advanced 2.3%.
Food sales were buoyed by its fast-growing online and convenience businesses, which grew 8.2% and 7.3% respectively.
Sainsbury’s insisted it “outperformed the market” in its clothing and general merchandise divison, which includes Argos, Habitat and its Tu clothing brand, amid what it called “challenging conditions”.
General merchandise sales slipped 1.4% across the quarter, while clothing revenues were up 1% compared to the same period a year ago.
Despite that turbulent backdrop, Sainsbury’s said it now expects to achieve between £80m and £85m in EBITDA synergies from the Argos acquisition by March – an acceleration from its previously guided £65m EBITDA.
As a result, the grocer said underlying profit for the full year would be “moderately ahead” of expectations.
‘Record sales’ over Christmas
Sainsbury’s boss Mike Coupe said it raked in record sales during Christmas week, fulfilling more than 340,000 online grocery orders.
Friday December 22 proved its biggest trading day in stores, while it also delivered an online grocery order every second on that day.
Including Argos, ecommerce accounted for 20% of Sainsbury’s sales during the third quarter.
Coupe added: “General merchandise and clothing grew market share in a challenging market. Argos stores in Sainsbury’s supermarkets performed particularly well and Argos saw record sales across the Black Friday period.
“I would like to thank all of our colleagues for their hard work and support over the past few months in helping us deliver a great Christmas for our customers.”