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UK grocery store chain J Sainsbury has offered additional proof that meals worth inflation is easing, because the group reported an virtually 10 per cent improve in gross sales.
“Meals inflation is beginning to fall and we’re absolutely dedicated to passing on financial savings to our clients,” Sainsbury’s chief government Simon Roberts mentioned in a buying and selling replace on Tuesday. “Costs on our prime 100 promoting merchandise are actually decrease than they have been in March.”
Information supplier Kantar printed figures final week displaying food price inflation had slowed for a 3rd consecutive month.
The feedback by Roberts echo these of Tesco chief government Ken Murphy who final month mentioned there have been “encouraging” indicators that inflationary pressures were easing.
Sainsbury’s on Tuesday reported a 9.8 per cent improve in like-for-like gross sales, excluding gas, for the three months to June 24, pushed by quantity development slightly than worth will increase, the corporate mentioned. Grocery gross sales rose 11 per cent, with basic merchandise up 4 per cent, forward of analysts’ expectations.
Roberts warned that though meals costs are coming down they’re “not going again to the place they have been as a result of the price of producing meals is clearly elevated from the place it was a 12 months or two in the past”.
Labour prices are up 10 per cent 12 months on 12 months, he added.
Meals costs have been falling most in contemporary meals, the place that they had risen essentially the most over the previous 12 months or so, however inflation was extra persistent in different classes.
Roberts once more rejected claims that supermarkets have been “profiteering” on meals costs, saying revenue margins of lower than 3 per cent have been at their lowest “for various years”.
The group saved its forecast of underlying revenue earlier than tax of between £640mn and £700mn for the 12 months unchanged.
Requested who is likely to be benefiting from surging inflation, Roberts mentioned: “Nobody desires inflation at this degree. Clients don’t need it. No enterprise desires it. Clearly the federal government doesn’t need it.”