J Sainsbury gets warm weather boost as quarterly sales beat forecast
J Sainsbury PLC on Tuesday backed guidance after strong food sales offset a weak contribution from General Merchandise & Clothing.
The London-based food retailer said total retail sales, excluding fuel, rose 2.7% on-year in the 16 weeks to June 20 to £9.15 billion from £8.92 billion the year prior, ahead of 2.4% growth forecast by company compiled consensus. Like-for-like sales, excluding fuel, were up 2.1%, ahead of 1.9% consensus.
"We have had an encouraging start to the year," Sainsbury said in a statement, although it cautioned the impact of the conflict in the Middle East "remains uncertain."
As a result, the FTSE 100-listed grocer continues to expect to deliver full-year total underlying operating profit of between £975 million and £1.08 billion and retail free cash flow of more than £500 million.
In the financial year ended February 28, Sainsbury reported underlying operating profit of £1.03 billion and retail free cash flow of £574 million.
Shares in Sainsbury rose 2.6% to 324.00 pence each in London on Tuesday with the wider FTSE 100 up 0.4%.
In the first 16 weeks of the current financial year, Grocery sales increased 3.6% to £7.60 billion from £7.34 billion, beating 3.4% consensus, with General Merchandise & Clothing sales down 3.7% to £438 million from £455 million, worse than the 1.0% drop forecast.
Argos sales fell 0.5% to £1.11 billion from £1.12 billion a year ago, but beat consensus which projected a decline of 2.6%.
Chief Executive Simon Roberts said: "Customers are looking for value now more than ever. We are consistently delivering outstanding quality at great value, so more people are choosing Sainsbury's for their big weekly shop. This has driven an encouraging start to the year with continued volume growth and market outperformance."
In Grocery, fresh food sales rose 5% on-year, boosted by the warm weather in May, while sales of the premium Taste the Difference range grew 6%. Grocery online sales jumped 13%. Convenience stores outperformed during warm weather periods with record breaking sales in "key" summer categories, the firm added.
Tu Clothing sales declined 2.1%, while General Merchandise sales fell 6.3%, primarily reflecting an ongoing programme to focus GM ranges "more tightly" and reduce space allocation in favour of food, "improving sales and profit densities".
"We will continue to make deliberate, balanced choices to sustain our strong competitive position and expect to continue to outperform the grocery market," J Sainsbury said.
At Argos, Sainsbury said "encouraging" volume growth of 2.2% was offset by the impact of subdued consumer spending on average selling price.
Lower sales in core seasonal categories were offset by growth in Home and Toys and the benefit from strong sales of fans during the May "heatwave" and large screen TV sales in the lead up to the World Cup.
The grocer said it remains on track to deliver £1 billion of cost savings over the three years to March 2027, investing in technology and infrastructure to drive operational efficiency.
Copyright 2026 Alliance News Ltd. All Rights Reserved.