UK supermarket group J Sainsbury has reported a near 3% fall in full-year profit and announced changes to its management structure.
The group reported underlying profit before tax of £675m (US$1.2bn) for the 52 weeks to 27 March 2004, compared to £695m in the previous year.
Total sales edged up 0.5% to £18.24bn, while sales from continuing operations were £15.52bn, up 2.4% from a year earlier. Total sales at Sainsbury’s Supermarkets, the group’s UK supermarkets business, rose 2.2% to £15.30bn, compared to £14.97bn in the previous year.
During the year the group sold its US unit, Shaw’s, to Albertsons for US$2.48bn. Sainsbury’s acquired 14 supermarkets from Morrisons during the year, as well as 54 Bell convenience stores.
As expected, the company also announced the departure of Stuart Mitchell, managing director of Sainsbury’s Supermarkets, and said all the senior team will now report directly to chief executive Justin King.
King said the sale of Shaw’s provided an opportunity to simplify the group structure. In the new structure there will be a new operating board, which combines the board of Sainsbury’s Supermarkets with the group executive committee.
As part of these management changes, Roger Matthews, finance director, will now take on more direct control of financial management across Sainsbury’s Supermarkets. Jim McCarthy has been appointed as managing director of the group’s convenience store operations.
“The past three years have seen enormous change but we must now build on the investments made and re-focus our attention on delivering a better offer for our customers. The sale of Shaw’s gives us a single-minded focus on the UK business. We have today announced changes to the senior team and management structure of the company as a result,” King said.
“We indicated in our fourth quarter trading statement on 26 March 2004 that we expected the current competitive environment in the UK to continue and that this would impact underlying profits in 2004/05. We made our first moves on pricing earlier this month and customers are already seeing the benefit in their shopping baskets. This is the first step in a much longer journey as we focus on improving our customer offer,” he added.