17 April 2025
If you are covering the latest financial results from Sainsbury’s, please find below a comment from Lucy Rumbold, equity research analyst at Quilter Cheviot:
“Sainsbury’s reported a solid set of results, with both sales and profits up nicely as the core grocery business continues to deliver the goods. Some of the growth was offset by continued weakness in Argos, however.
“That said, the biggest takeaway from this set of results is the guidance. The company has said that operating profit growth with stagnate as competition in the UK supermarket space ramps up significantly. Sainsbury’s continues to invest in its range of lower priced goods, and this will be necessary given the requirement to compete with Asda’s new pricing strategy.
“Management has set a confident tone, however, stating they expect to grow food volumes ahead of the market and have started the year with good trading momentum. It will be interesting to see how this progresses over the year given Sainsbury’s is not a discount or budget retailer and thus won’t want to be seen to be compromising on quality. With M&S delivering strong growth of late at the other end of the pricing scale, Sainsbury’s may find itself squeezed in the middle.”
