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| Coronavirus: Sainsbury’s boss warns queues set to stay in place | |
| (32 minutes later) | |
| Sainsbury's says that customers are likely to see disruption to their shopping until September amid the coronavirus pandemic. | Sainsbury's says that customers are likely to see disruption to their shopping until September amid the coronavirus pandemic. |
| Its boss Mike Coupe told the BBC that socially-distanced queues were likely to remain "for the foreseeable future". | Its boss Mike Coupe told the BBC that socially-distanced queues were likely to remain "for the foreseeable future". |
| In its full-year results statement, the supermarket said it saw huge demand for groceries in March as concerned shoppers stockpiled goods. | In its full-year results statement, the supermarket said it saw huge demand for groceries in March as concerned shoppers stockpiled goods. |
| Sales growth peaked at 48% in the week to 21 March, but then subsided. | Sales growth peaked at 48% in the week to 21 March, but then subsided. |
| Mr Coupe told the BBC's Today programme that the peak of sales "was crazy". | Mr Coupe told the BBC's Today programme that the peak of sales "was crazy". |
| "We sold more, for five days running, than we would normally sell in our busiest day at Christmas, that's why you saw the gaps on the shelf." | "We sold more, for five days running, than we would normally sell in our busiest day at Christmas, that's why you saw the gaps on the shelf." |
| Mr Coupe added that amid the pandemic, the retailer - which is the UK's second-largest supermarket chain - had seen "a very marked change in the way our customers are shopping". | Mr Coupe added that amid the pandemic, the retailer - which is the UK's second-largest supermarket chain - had seen "a very marked change in the way our customers are shopping". |
| "They're coming less frequently and are buying about twice as much when they do come. Very much a return to the weekly shop, but beyond it." | "They're coming less frequently and are buying about twice as much when they do come. Very much a return to the weekly shop, but beyond it." |
| In the seven weeks to 25 April, the firm's Argos business also saw an uptick in sales of 7%. It said this was down to customers equipping themselves for home working. | In the seven weeks to 25 April, the firm's Argos business also saw an uptick in sales of 7%. It said this was down to customers equipping themselves for home working. |
| Stand-alone Argos stores have been closed since 24 March after the government instructed "non-essential" retailers to shut temporarily, although Argos concessions with Sainsbury's stores remain open. | Stand-alone Argos stores have been closed since 24 March after the government instructed "non-essential" retailers to shut temporarily, although Argos concessions with Sainsbury's stores remain open. |
| Coronavirus-related costs | Coronavirus-related costs |
| In common with other retailers, Sainsbury's has brought in a number of measures in an attempt to keep customers and staff safe during the pandemic, as well as cope with the surge in demand for food. | In common with other retailers, Sainsbury's has brought in a number of measures in an attempt to keep customers and staff safe during the pandemic, as well as cope with the surge in demand for food. |
| They included installing screens at tills, increasing cleaning and recruiting thousands of temporary staff to work in-store, as drivers and in warehouses. | They included installing screens at tills, increasing cleaning and recruiting thousands of temporary staff to work in-store, as drivers and in warehouses. |
| Sainsbury's said that those additional costs, as well as weaker demand for clothing and fuel, could result in a £500m hit to its profits. | Sainsbury's said that those additional costs, as well as weaker demand for clothing and fuel, could result in a £500m hit to its profits. |
| However, the supermarket has also benefitted from a business rates holiday worth about £450m offered to shops in England, Scotland and Northern Ireland. It also expects some of the additional coronavirus costs will be offset by higher grocery sales. | However, the supermarket has also benefitted from a business rates holiday worth about £450m offered to shops in England, Scotland and Northern Ireland. It also expects some of the additional coronavirus costs will be offset by higher grocery sales. |
| Sophie Lund-Yates, equity analyst at Hargreaves Lansdown said that lockdown had "pushed people down the grocery aisles, and away from the not-so-crucial areas of stores", such as clothing. | Sophie Lund-Yates, equity analyst at Hargreaves Lansdown said that lockdown had "pushed people down the grocery aisles, and away from the not-so-crucial areas of stores", such as clothing. |
| "It's a mistake to assume coronavirus is an out-and-out tailwind for supermarkets. Feeding a panicked, locked-down nation comes with extraordinary costs and changes to spending habits," she said. | "It's a mistake to assume coronavirus is an out-and-out tailwind for supermarkets. Feeding a panicked, locked-down nation comes with extraordinary costs and changes to spending habits," she said. |
| Sainsbury's comments came as it reported a 2% fall in underlying pre-tax profits to £586m for the year to 7 March. | Sainsbury's comments came as it reported a 2% fall in underlying pre-tax profits to £586m for the year to 7 March. |
| The supermarket said that it would defer any decisions on paying dividends to shareholders until later in the year. | The supermarket said that it would defer any decisions on paying dividends to shareholders until later in the year. |
| "At this very early point in our financial year it is impossible to predict the full nature, extent and duration of the financial impact of Covid-19 over the course of the year," it said. | "At this very early point in our financial year it is impossible to predict the full nature, extent and duration of the financial impact of Covid-19 over the course of the year," it said. |