Blog: Sainsbury's faces fresh challenges after strong year
Dean Best | 8 May 2012
Sainsbury's, the UK's third-largest grocer, will tomorrow (9 May) report its annual financial results. Of the UK's largest food retailers, Sainsbury's has been one of the better performers in recent months but, as ever in the country's fiercely competitive market, it faces a new round of challenges over the next 12 months.
Initiatives including the Brand Match price-comparison scheme have enabled Sainsbury's to drive sales over the last year, while rivals like Tesco, and more recently Morrisons, have stuttered.
In March, Sainsbury's reported a 2.1% increase in like-for-like sales for the year to 17 March. Tomorrow, Sainsbury's is expected to report an increase in annual pre-tax profits of around 5%, a slowdown from the 9% increase it filed last year, an indication perhaps of the cost of competing in the UK grocery sector and also the expansion of its store network over the last year. However, Sainsbury's has won praise from industry watchers. Shore Capital analyst Clive Black says he believes Sainsbury's "has cranked out a very good performance" over the last 12 months.
Nevertheless, as ever in the UK's fiercely competitive market, Sainsbury's faces a fresh set of challenges, including Tesco's plans to revitalise its UK business and, interestingly, from Waitrose. Last week, Waitrose announced an extension of its own price-comparison initiative against Tesco, which as well as targeting the UK's largest retailer, could also lure some shoppers away from Sainsbury's.
The thoughts of Sainsbury's chief executive Justin King on these issues and more (including the Government's expected announcement tomorrow of an adjudicator to monitor dealings between retailers and suppliers) will be worth hearing.
Danone completed its US$12.5bn acquisition of WhiteWave Foods this week. The move will roughly double Danone's presence in North America, where WhiteWave is a top four dairy player. ...
Premier Foods plc revealed today (28 March) it has secured a deal with its pension scheme trustees that will see the UK food maker reduce its pension burden....
Hain Celestial, under the scrutiny of the investment community in recent months and facing some challenges in its domestic market, has announced another shuffling of its management pack....
FrieslandCampina, which today served up higher profits but lower sales for 2016, is ready to offload the last non-dairy business owned by the Dutch cooperative giant....
- Danone's Q1: four things to learn
- Who will buy Danone's Stonyfield business?
- Nestle Q1 update: four things to learn
- Interview: Sir Kensington's on sale to Unilever
- Column: Why snacking is the new meal
- Tyson shops Sara Lee bakery, Kettle and Van's
- Nestle to cut UK confectionery jobs
- PepsiCo affirms full-year target as Q1 hits mark
- Tyson to buy burger-to-entree firm AdvancePierre
- Icelandic to sell Saucy Fish Co. owner Seachill