Sainsbury’s has cut its forecast for annual sales, and announced that it is reviewing its dividend after it was forced to slash prices amid the toughest grocery market for decades.
In a trading update released today (1 October), the group said sales fell more quickly in the second quarter of the financial year, and that they are not expected pick up in the second half.
Sales at stores open a year or more, excluding fuel, dropped by 2.8 per cent in the 16 weeks to 27 September, compared with a 1.1 per cent fall in the previous three months.
The company's new chief executive, Mike Coupe, said: “We are in a very dynamic market at the moment, and we are looking at all aspects of our business. We will leave no stone unturned.
'The rate of change going on in the marketplace is something we will be thinking very carefully about over the next six weeks.”
David Gray, retail analyst at Planet Retail, said of the latest woes at another major retailer: “These results mark a watershed moment for both Sainsbury’s and the wider UK grocery industry. The sharp decline in like-for-like and total sales at the retailer will send shockwaves across the market.
'First it was Tesco, then Morrisons, and now even Sainsbury’s is reeling from the effects of seismic structural changes rumbling across the UK food sector. No-one is immune to the effects and there is no hiding place. This is more akin to long-term climate change than the temporary effects of a perfect storm.”
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