J Sainsbury HY Pre-tax Profit Down 27%, Sees FY Profit Upper Half Of Its Previous Guidance

J Sainsbury plc (JSAIY.PK,SBRY.L) reported that its profit before tax for the 28 weeks ended 16 September 2023 was 275 million pounds, down 27% from the prior year, reflecting non-cash movements and one-off income from legal settlements in the prior year.

Profit for the period was 155 million pounds or 6.5 pence per share, down 46% from the prior year.

Underlying earnings per share 10.3 pence, down 7% due to the higher rate of corporation tax.

The company declared an interim dividend of 3.9 pence, unchanged year-on-year in line with its policy of paying 30% of the prior full year dividend per share.

Grocery sales were up 10.1%. Volume growth across both quarters driving record market share gains and consistent market outperformance.

General Merchandise sales were up 1.1% despite tough weather comparatives over the summer; up 2.5% excluding the impact of the closure of Argos in the Republic of Ireland.

Clothing sales were down 8.4%, reflecting a disciplined trading approach in a seasonally weak and promotionally-driven market.

Statutory Group sales were up 3.5%, with fuel sales down 19.6% driven by lower input prices. Like-for-like Retail sales (excluding fuel) up 8.4%.

Group sales, including VAT, increased by 2.9 per cent year-on-year as a 7.7 per cent increase in Retail sales, (including VAT, excluding fuel) and a 25.2 per cent increase in Financial Services sales more than offset a 19.6 per cent decrease in Fuel sales, including VAT.

The company now expects underlying profit before tax for fiscal year 2023/24 to be between 670 million pounds and 700 million pounds, the upper half of its previous guidance range of 640 million pounds to 700 million pounds.

The company expects annual retail free cash flow to be at least 600 million pounds, higher than previous guidance of at least 500 million pounds.

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