Sainsbury’s synergies from Argos deal helps boost profits

Sainsbury’s warns over consumer outlook as half-year profits rise

Sainsbury’s warns over consumer outlook as half-year profits rise

Shares in J Sainsbury (LON:SBRY) have jumped in London this morning, as the blue-chip grocer posted a rise in sales for the first half of its financial year.

For its first half to 22 September, Sainsbury's made an underlying pretax profit of £302 million - ahead of analysts' mean forecast of £280 million and the £251 million made in the same period previous year.

Half-year profits, however, slumped by 40% to £132 million due to restructuring and a bevy of one-off expenses related to Argos integration, Sainsbury's Bank transition and the proposed merger with Asda.

The hot summer has helped Sainsbury's to profit and sales growth, but the supermarket warned of an uncertain consumer outlook heading into the key Christmas season.

Sainsbury's said that while like-for-like sales, excluding fuel, increased by just 0.6 per cent, it benefited from cost savings of 121 million pounds - some 63 million of which were synergies from the Argos business Sainsbury's purchased in 2016.

Although industry data shows Sainsbury's trading performance is lagging rivals, its shares are up 32 percent this year on the back of April's agreed 7.3 billion pounds takeover of Walmart owned Asda - a deal that could see the group leapfrog Tesco as Britain's biggest retailer. The World Cup and barbecue weather over the summer provided a welcome shot in the arm for the supermarket, though without this seasonal stimulus, sales growth from existing outlets wouldn't look great.

'Taylor's Actions Disgraceful': Sarfraz Lashes Out at New Zealand Batsman
It looked all over when legspinner Ish Sodhi snared Shadab Khan caught behind to a poor call from umpire Joel Wilson. It all started in the second ball of the third over when Boult knocked over Fakhar with an incoming delivery.

This meant comparable store sales rose 0.6 per cent overall in the half-year.

Mike Coupe, Sainsbury's group chief executive, noted that the retailer was transforming its business to meet rapidly changing customer needs.

He said the group continued to "engage constructively" with the competition watchdog amid an in-depth probe of its planned tie-up with Asda.

Despite this, Sainsbury's remains on track for full-year expectations, with analysts pencilling in underlying pre-tax profits of about £634m.

It opened a further 60 Argos stores in its supermarkets over the six months, bringing the total to 251.

Recommended News

  • NHL Winter Classic: Blackhawks, Bruins unveil jerseys that celebrate 1930s

    NHL Winter Classic: Blackhawks, Bruins unveil jerseys that celebrate 1930s

    The Blackhawks Winter Classic look plays off the team's 1943 uniform, the same year Chicago won its first Stanley Cup. The Bruins have unveiled the jerseys they will be wearing for the 2019 Winter Classic.
    Deals and freebies for Veterans Day 2018

    Deals and freebies for Veterans Day 2018

    On Saturday, November 11 , from 11am to 2pm, veterans and active military members can receive a free $5 HOT-N-READY® Lunch Combo. Sheetz: All veterans and active duty military personnel can enjoy a free 6-inch turkey sub and a regular size fountain drink.
    ‘Bachelor’ mansion burned in California’s Woolsey Fire

    ‘Bachelor’ mansion burned in California’s Woolsey Fire

    The 7,500 sq. ft. mansion has been the filming location for The Bachelor and The Bachelorette since 2007. It was evacuated on Friday, along with the rest of the area.
  • Stephen Hawking's wheelchair and thesis sold at auction

    Stephen Hawking's wheelchair and thesis sold at auction

    Personal effects of Stephen Hawking, including a signed copy of his 1965 PhD thesis, have raised more than £1.8m at auction. The wheelchair raised $387,480 (£296,750), nearly 20 times more than pre-auction estimates of up to $19,500 (£15,000).
    Back on top, Djokovic eyes sixth ATP Finals crown

    Back on top, Djokovic eyes sixth ATP Finals crown

    If I can keep doing what I'm doing, I will be playing the best tennis I can. "I don't know what the options are". He posted a 22-match winning streak from Cincinatti to the Paris Masters, taking in the U.S.
    SSE and npower merger hits the skids over price cap

    SSE and npower merger hits the skids over price cap

    Next year will see the introduction of the energy bill price cap, which has been set at £1,137 a year for "typical usage". It said the talks were expected to take place over several weeks, with an update on progress to be given by mid-December.
  • The vet Pete Davidson mocked joined him on 'SNL' last night

    A week after comic Pete Davidson made fun of a Republican war veteran's eye patch on Saturday Night Live , Lt. Davidson apologized and Crenshaw revealed his ringtone was Ariana Grande .
    China export growth surprisingly strong in Oct.

    China export growth surprisingly strong in Oct.

    China's overall trade - what it buys and sells with all countries including the U.S. - logged a $34 billion surplus for the month. The country's cumulative trade surplus with the U.S.in the first 10 months of the year was $258.15 billion, Reuters reported.
    LLC Purchase Holding in Canopy Growth Corp (NYSE:CGC)

    LLC Purchase Holding in Canopy Growth Corp (NYSE:CGC)

    Maximum and minimum EPS estimate for the current quarter is projected at $0.01 and $-0.01, respectively, according to 2 analysts. Whereas, in last 21 trading days (one month) was moved up -5.44% and increased in last 63 trading days (quarter) of 61.20%.
  • Mourinho side-steps City's Financial Fair Play row

    Mourinho side-steps City's Financial Fair Play row

    The Red Devils came from 1-0 down to secure a 2-1 win at Juventus in the Champions League on Wednesday night to continue to build momentum under Mourinho.
    Liverpool receive major injury boost ahead of Premier League clash with Fulham

    Liverpool receive major injury boost ahead of Premier League clash with Fulham

    He said talks were "all positive", but that they contrast with perceptions of Liverpool's campaign outside the club. Indeed he has contributed just one goal less this season as of now than he had at this time last season.
    Trump lashed by critics after skipping military cemetery visit over rain

    Trump lashed by critics after skipping military cemetery visit over rain

    On Saturday morning, Trump and Macron discussed their differences about European security. Trump, however, will not be attending.

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.