Sainsburys chief executive King is optimistic following a strong H1

Sainsbury's chief executive King is optimistic following a strong H1

The head of Sainsbury's is positive about the remainder of the year after the UK retailer posted strong first-half profits, despite economic uncertainty.

Chief executive Justin King forecast a strong festive period after Sainsbury's posted an underlying profit before tax of GBP354m (US$570m) for the 28 weeks up to 1 October, up 6.6% on the same period last year.

Profit before tax dropped to GBP395m, down from GBP466m because Sainsbury's only made GBP39m on the disposal of property this year, compared to GBP106m last year.

Total sales for the period rose to GBP12.8bn, up from GBP11.9bn in last year's first-half. Like-for-like sales growth was 1.9% in both the first and second quarters.

The company hailed cost savings of GBP50m that offset inflationary increases, a 1m rise in weekly customer transactions to nearly 22m and the successful launch of the Live Well For Less and Brand Match pricing campaigns as key drivers in its success. It also added seven new stores, 15 extensions and 37 convenience stores, creating over 2,700 jobs.

King said: "We expect the economic environment to remain challenging for the foreseeable future but we are confident of further good progress in the Christmas period ahead."