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| Sainsbury's cuts its sales forecast | Sainsbury's cuts its sales forecast |
| (about 5 hours later) | |
| Sainsbury's has cut its full-year sales forecast after warning that customers are likely to "spend cautiously" in the first few months of 2014. | Sainsbury's has cut its full-year sales forecast after warning that customers are likely to "spend cautiously" in the first few months of 2014. |
| The supermarket giant had expected to see a sales rise of 1% to 1.5% in this financial year. | The supermarket giant had expected to see a sales rise of 1% to 1.5% in this financial year. |
| But despite seeing record transactions in the run-up to Christmas, it now expects growth of "just under 1%". | But despite seeing record transactions in the run-up to Christmas, it now expects growth of "just under 1%". |
| Although Sainsbury's reported a 36th consecutive quarter of like-for-like sales growth, its shares fell 2%. | |
| In the 14 weeks to 4 January, the firm's like-for-like sales, stripping out the effect of new stores, rose 0.2% excluding fuel. | In the 14 weeks to 4 January, the firm's like-for-like sales, stripping out the effect of new stores, rose 0.2% excluding fuel. |
| Sainsbury's said the seven days before Christmas were the firm's "busiest ever" trading week, with more than 28 million transactions. | Sainsbury's said the seven days before Christmas were the firm's "busiest ever" trading week, with more than 28 million transactions. |
| It described the third-quarter figures as a "good sales performance in a tough market". | It described the third-quarter figures as a "good sales performance in a tough market". |
| Rival chains Waitrose and the Co-op also reported rises in sales over the Christmas period. | Rival chains Waitrose and the Co-op also reported rises in sales over the Christmas period. |
| 'Tough and challenging' | 'Tough and challenging' |
| Late last year, Sainsbury's overtook Asda and moved into the number two spot for the largest supermarket in the UK, second to Tesco. | Late last year, Sainsbury's overtook Asda and moved into the number two spot for the largest supermarket in the UK, second to Tesco. |
| Chief executive Justin King told the BBC that trading conditions had been "tough and challenging" and there had been an expectation that the firm's sales might have fallen. | Chief executive Justin King told the BBC that trading conditions had been "tough and challenging" and there had been an expectation that the firm's sales might have fallen. |
| However, while October and November had been difficult, the performance over Christmas had resulted in "a small amount of growth for the quarter, taken as a whole". | However, while October and November had been difficult, the performance over Christmas had resulted in "a small amount of growth for the quarter, taken as a whole". |
| "We've beaten our competition," he added. | "We've beaten our competition," he added. |
| Sainsbury's also reported healthy growth in sales of its own-brand Taste the Difference range, which saw a rise in sales of more than 10%. | Sainsbury's also reported healthy growth in sales of its own-brand Taste the Difference range, which saw a rise in sales of more than 10%. |
| Other successful sectors included Sainsbury's convenience stores, which grew nearly 18%, and online shopping, which notched up more than 10% growth. | Other successful sectors included Sainsbury's convenience stores, which grew nearly 18%, and online shopping, which notched up more than 10% growth. |
| BBC business editor Robert Peston described the sales growth of 0.2% as "a bump in the road after an extraordinary 35 quarters of unbroken growth", but "not one such that [Mr] King is likely to feel desperately uncomfortable". | BBC business editor Robert Peston described the sales growth of 0.2% as "a bump in the road after an extraordinary 35 quarters of unbroken growth", but "not one such that [Mr] King is likely to feel desperately uncomfortable". |
| Joseph Robinson, lead consultant at retail analysts Conlumino, said that Sainsbury's "continues to outperform its main peers". | Joseph Robinson, lead consultant at retail analysts Conlumino, said that Sainsbury's "continues to outperform its main peers". |
| However, he said the low growth was "reflective of a market where even the outperforming mainstream players are having to sprint just to standstill, amid growing threats at both ends of the value spectrum". | However, he said the low growth was "reflective of a market where even the outperforming mainstream players are having to sprint just to standstill, amid growing threats at both ends of the value spectrum". |
| Late rush | Late rush |
| At the same time, rival Waitrose reported strong sales in the run-up to Christmas. | At the same time, rival Waitrose reported strong sales in the run-up to Christmas. |
| On a like-for-like measure, sales for the five-week period to Christmas Eve rose 3.1% compared with 2012. | On a like-for-like measure, sales for the five-week period to Christmas Eve rose 3.1% compared with 2012. |
| Waitrose said it was a record Christmas period, with a 4.1% rise in sales for the 12 days ending 31 December. | Waitrose said it was a record Christmas period, with a 4.1% rise in sales for the 12 days ending 31 December. |
| Like other retailers, Waitrose has reported a huge increase in online sales, which were up by more than a third compared with 2012. | Like other retailers, Waitrose has reported a huge increase in online sales, which were up by more than a third compared with 2012. |
| Waitrose managing director, Mark Price, said: "Every year retailers say that Christmas is late, but with some justification in 2013, as customers phased their shopping in line with the mid-week fall of the main festivities." | Waitrose managing director, Mark Price, said: "Every year retailers say that Christmas is late, but with some justification in 2013, as customers phased their shopping in line with the mid-week fall of the main festivities." |
| The BBC's Steph McGovern said "squeezed-middle" Sainsbury's was seeing its market under pressure both from high-end Waitrose and from discounters Aldi and Lidl. | The BBC's Steph McGovern said "squeezed-middle" Sainsbury's was seeing its market under pressure both from high-end Waitrose and from discounters Aldi and Lidl. |
| She said Aldi and Lidl were the "clear winners" of the Christmas period: "They've done brilliantly with double-digit growth." | She said Aldi and Lidl were the "clear winners" of the Christmas period: "They've done brilliantly with double-digit growth." |
| On Tuesday, the two German-owned firms both said they had seen their best Christmas in the UK to date, although they did not release sales figures. | On Tuesday, the two German-owned firms both said they had seen their best Christmas in the UK to date, although they did not release sales figures. |
| The Co-op also reported rising sales in its food business over the festive season, "driven by the success of the strategy to strengthen its core convenience offer". | The Co-op also reported rising sales in its food business over the festive season, "driven by the success of the strategy to strengthen its core convenience offer". |
| In the 13 weeks to 4 January, its like-for-like sales grew by 1% compared with the same period a year earlier. However, total food sales were flat over the whole quarter as the Co-op disposed of some larger stores. | In the 13 weeks to 4 January, its like-for-like sales grew by 1% compared with the same period a year earlier. However, total food sales were flat over the whole quarter as the Co-op disposed of some larger stores. |
| So far, Debenhams has been the big disappointment in the Christmas trading updates from UK retailers. It warned of a sharp drop in profits due to heavy discounting. | So far, Debenhams has been the big disappointment in the Christmas trading updates from UK retailers. It warned of a sharp drop in profits due to heavy discounting. |