Retailer’s Q3 trading statement shows general merchandise sales up 6.0% and Argos sales up 8.4%.
Sainsbury’s has reported its third quarter trading for the 15 weeks to January 2, 2021 – with sales of general merchandise and clothing performing ahead of expectations.
Gross margins on general merchandise and clothing benefited from better than anticipated full price sales, the retailer said, driven by customers shopping earlier for Christmas and successful changes to its Black Friday trading strategy.
General merchandise sales grew by 6.0% for the period, with clothing sales up slightly by 0.4%, with Tu Clothing growing market share in both value and volume, with strong online growth.
Argos sales grew by over 8% in the quarter, with nearly 90% of sales starting online and Fast Track delivery grew by 62%.
Argos’ growth was driven by a strong performance across a wide variety of categories, with particularly good growth in Christmas gifting, gaming consoles and TVs. This was despite a Black Friday performance which reflected a continued reduction in promotional activity in favour of lower everyday prices.
Overall, Sainsbury’s reported Christmas like for like sales were up 9.3%, while Q3 like for like sales grew 8.6% (excluding fuel) and total retail sales increased 6.8% (excluding fuel).
Grocery sales increased 7.4%m, with groceries online up 128%.
The retailer now expects – after forgoing business rates relief of £410m – to report underlying profit before tax of at least £330m in the financial year to March 2021 (financial year to March 2020: £586m).
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