Sainsbury's total sales slip in Christmas quarter

Sainsbury’s reported a decline in its total retail sales over the Christmas quarter on Wednesday, but pointed to “strong” grocery performance and online growth during the 15 weeks ended 4 January.

The FTSE 100 supermarket said grocery sales were up 0.4% in the third quarter, with groceries online rising 7.3%.

Clothing sales were ahead 4.4%, but the company said general merchandise sales declined by 3.9%.

Total online sales grew 5%.

Sainsbury’s said total retail sales fell 0.7% excluding fuel, with like-for-like sales also down 0.7% excluding fuel.

Looking ahead, the firm said retail markets remained highly competitive and promotional, with consumer outlook still uncertain.

However, Sainsbury’s said it was “well-placed” to navigate that external environment, with its board saying it was “executing well” against its strategy.

“We gave our customers a great combination of quality food at good prices this Christmas and we delivered a standout performance operationally,” said chief executive officer Mike Coupe.

“We have a real sense of momentum in Sainsbury's and investment in our stores and improvements to service and availability have led to our highest customer satisfaction scores of the year.

“Our digital investments are also paying off and over 20% of our business was online in the quarter.”

Coupe noted that the company’s groceries online operation had record order numbers throughout the Christmas period, with customers increasingly choosing to shop with its ‘SmartShop’ product in its supermarkets.

“Argos had its biggest digital Black Friday to date and record sales through mobile and via Argos Click and Collect.

“32 million customers shopped with us across Sainsbury's and Argos in the key Christmas week.

“The colder weather helped to deliver strong clothing sales in the quarter and our Christmas, party and gifting ranges were all popular with customers.”

Argos reportedly outperformed the market in consumer electronics, but the toy and gaming markets declined year-on-year, Coupe noted.

At 0833 GMT, shares in J Sainsbury were down 0.13% at 230.69p.