BBC News business reporter, Dearbail Jordan, reported that Sainsbury’s is anticipating a minimal impact from the reduction in prices. The grocery retailer projects a decrease in underlying retail profit of approximately £36m for the year, a figure significantly lower than the potential £400m impact expected by Tesco.
Despite the anticipated dip in profit, Sainsbury’s disclosed a 3.1% increase in full-year sales, amounting to £31.5bn. The pre-tax profit also saw a substantial jump from £277m to £384m. The retailer’s revenue witnessed robust growth over the 12-month period ending on 1 March.
However, sales at Argos, a subsidiary of Sainsbury’s, experienced a decline during the same period. Nevertheless, the company noted an improvement in the situation as traffic to the brand’s website increased. Additionally, Sainsbury’s reported an 8.9% decrease in fuel sales, attributing it to reduced demand and the lower fuel prices resulting from the competitive market environment and falling commodity prices.
Data released recently indicated that the decrease in motor fuel costs played a role in driving down the overall rate of inflation. Inflation dropped more than expected to 2.6% in the year leading up to March, down from 2.8% recorded in February
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