- The UK’s second-biggest grocery retailer, Sainsbury’s, posted 1Q18 comps of 2.3%, excluding fuel and including Argos in the prior year base.
- Total sales increased by 2.7%, including Argos in the base and excluding fuel and the impact of the sale of Sainsbury’s pharmacy business.
- Sainsbury’s reaffirmed its target to deliver £160 million in EBITDA synergies from the Argos acquisition by March 2019, and achieve £145 million in cost savings this fiscal year.
Like most UK companies, British supermarket retailer J. Sainsbury reports profit data only at the half-year and full-year, and updates on sales growth each quarter.
Sainsbury’s reported comps of 2.3% in 1Q18, for the period ended July 1, excluding fuel and including general merchandise business Argos, which it acquired early last year. Total sales grew by 2.7% in the quarter, including Argos and stripping out fuel and the impact of the sale of its pharmacy business.
Excluding Argos from the base, and excluding fuel and the effects of the pharmacy business sale, total retail sales jumped 24.4%.
Performance by Segment
The below figures include Argos in the prior year base.
- Grocery sales grew by 3.0%, boosted by ranges focused on summer food. Online groceries sales posted growth of 8% and convenience stores posted growth of 10%.
- General merchandise sales grew by 1.0%. The company highlighted strong growth in the mobile, audio and tech categories, and in toys. Summer products, such as paddling pools and fans, were particularly popular, with many products collected from stores or purchased via Argos’s Fast Track delivery option. Online sales were up by 10%.
- Clothing sales bounced 7.2%, with strong growth both online and in stores.
Sainsbury’s reaffirmed its target to deliver £160 million in EBITDA synergies from the Argos acquisition by March 2019, and achieve £145 million in cost savings this fiscal year.
For FY18, the consensus among analysts is for GAAP EPS of 15 pence, versus 17 pence in FY17. Analysts expect the company to grow total revenues in FY18 by 7.3% to £28.1 billion and increase EBITDA by 5.9% to £1.4 billion. These estimates were collated before the latest results were announced.