11th Jun 2014 06:34
LONDON (Alliance News) - J Sainsbury PLC reported Wednesday another drop in like-for-like sales, its second consecutive quarterly decline, after nine years of unbroken sales growth.
The UK's third largest supermarket chain by market share posted a 1.1% decline in like-for-like retail sales including VAT but excluding fuel for the 12 weeks to June 7 from the same period a year earlier. Including fuel, like-for-like retail sales fell 2.4%.
Total group sales in the period declined by 1% excluding fuel, and 0.3% including fuel.
"Throughout the quarter we have continued to invest in reducing prices and improving quality, increasing the value of our offer," Chief Executive Justin King said in a statement.
"We expect customer spending to remain cautious, and we will continue to invest to keep our offer competitive to help customers balance their household budget," King added.
Despite the sales fall, Sainsbury's said its strengths and the driving forces behind the business remain the same: capturing the importance of local convenience stores and online grocery shopping, at a time when consumers continue to move away from large out-of-town supermarkets, preferring the ease of shopping from home or at smaller local stores.
"We remain confident that our clear strategy and differentiated offer will allow us to continue to outperform our supermarket peers through the remainder of the year," said King.
Sainsbury's said that sales from its convenience store business grew by over 18% in the quarter from the previous year, and during the quarter opened its 200th convenience store in London. Groceries online also posted good growth, increasing 10% year-on-year in the period.
Sainsbury's general merchandise and clothing businesses continued to grow strongly in the quarter, it said, with clothing in particular performing well, delivering double-digit like-for-like sales growth.
The supermarket chain recently announced it will trial a new online clothing offer for its TU clothing brand, in August.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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