Sainsbury's Raises Profit Forecast After Strong Christmas
British supermarket group Sainsbury's has raised its full-year profit forecast as it reported strong trading in the key Christmas quarter, benefiting from COVID-19 restrictions which kept people eating and drinking at home.
Sainsbury's, Britain's second largest grocer after Tesco, said like-for-like sales, excluding fuel, rose 8.6% over the 15 weeks to Jan. 2, its fiscal third quarter.
As a result it now expects after forgoing business rates relief of £410 million to report underlying profit before tax of at least 330 million pounds in its year to March 2021.
That is down from the £586 million it made in the previous year but ahead of a forecast made last month of at least £270 million.
'Stronger Than Expected'
Sainsbury's said grocery, general merchandise and clothing sales were stronger than it had expected, particularly during England's second national lockdown in November and subsequent increased restrictions throughout the UK.
Industry data from market researcher Kantar, published on Tuesday, showed all of Britain's supermarket groups benefited from unprecedented Christmas demand due to the pandemic, with UK shoppers spending £11.7 billion on groceries in December.
Restrictions to stem the spread of COVID-19 mean a large chunk of the population is still working from home and the hospitality sector is closed.
Supermarkets also had more mouths to feed, with many of the five million or so Britons who normally travel abroad for Christmas staying in the UK.