Sainsbury’s Sales Rise as Food Inflation Begins to Fall

Sainsbury’s reported strong grocery momentum in its first quarter update this morning, reflecting a fall in food inflation and a return to volume growth for the retailer.

Like-for-like sales were up 9.8%, while total retail sales exc fuel gained 9.2%. The supermarket giant reported a strong performance in grocery, with sales up 11%. Its performance broadly reflects rival Tesco, who reported a 8.2% rise in retail sales a few weeks ago.

However, its clothing market was unable to emulate the performance in food, with clothing sales down 3.7% YoY.

Simon Roberts, Chief Executive: “Customers can see that prices at Sainsbury’s have improved and this combination of great value and some good weather in recent weeks means we have grown our food volumes and market share.”

Roberts added that “food inflation is starting to fall” and Sainsbury’s are committed to passing on savings to customers.

As a result, the group maintained its outlook of £640m and £700m in underlying profit before tax for FY23/24, as well as generating £500m of retail cash flow.

Sainsbury’s shares are down just 1.5% so far this morning.

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