UK: Sainsbury's sees sales growth slow

UK supermarket group Sainsbury's has revealed that its quarterly like-for-like sales growth slowed during the final three months of the fiscal year as lower food prices and a cautious consumer environment took their toll.

Comparable sales in the three months to 20 March dipped to 1.7%, excluding fuel. The company has seen its like-for-like sales slow from a high of 7% in the first quarter of the year, dipping to 5.7% in the second quarter and 3.7% in the third.

For the full year, like-for-like sales gained 4.3%, the company said this morning.

Nevertheless, Sainsbury's chief executive Justin King (pictured) remained upbeat, insisting that the fourth quarter numbers were a “good performance” that were “in line with expectations" and "on top of strong growth last year”.

The company emphasised that it has seen increased footfall, with over 19m weekly transactions, up one million year-on-year.

Sainsbury's has also invested in expanding its selling space during the fiscal, with gross space growth of 6.8% propelling total sales growth of 6.3%, excluding fuel.

The company has opened or extended more than 100 new supermarkets and convenience stores and reiterated that it is focused on its multi-channel strategy through the opening of convenience outlets.

“Great food at fair prices is at the core of our offer. We take a lead on providing healthy, fresh and tasty food by investing in product quality and developing ranges that really matter to our customers. In the quarter we successfully relaunched Freefrom and Be Good To Yourself and were proud to be confirmed as the world's largest retailer of fairtrade products by value,” King said.

However, King sounded a note of caution on the group's prospects for the coming year.

 "We expect the consumer environment to remain challenging in 2010,” he warned.

Nevertheless, he continued: “Our universal customer appeal together with our accelerated growth of space for new supermarkets, extensions and convenience stores means we are well placed to make continued good progress in the new financial year.”