Blog: Sainsbury's King sees 2010 as less than majestic
Dean Best | 7 January 2010
After yesterday's (6 January) market gloom over the latest numbers from Marks and Spencer came something today to warm retail investors - a set of robust figures from M&S alumni Justin King at Sainsbury's.
The UK's number three grocer posted a 3.7% rise in like-for-likes for the 13 weeks to 2 January after what the company said was a "record" Christmas for the business.
The numbers received broad approval from the analyst community. Shore Capital analyst Clive Black said Sainsbury's had released an "excellent" trading statement and had led him to up his profit forecast for the business.
Shares in Sainsbury's were among the biggest rises on the FTSE today and were up 3.7% at 16:00 this afternoon. On paper, then, a pretty buoyant day for King.
However, the Sainsbury's chief executive was quick to point out that trading in the year ahead is likely to be challenging with the spectre of higher taxes set to pressure consumer spending. There also remains the prospect of rising fuel prices later in the year; in all, the trading environment in 2010 is unlikely to be much different to that seen last year.
For all of the initial cheer over some of the UK retail numbers to emerge this week, we would do well to be cautious about the prospects for rapid recovery.
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