Sainsbury’s report strong quarterly sales and confirms expansion plans
Supermarket giant Sainsbury’s has reported that like-for-like sales were up 7.8% for the 12 week period to 13 June.
The news comes just a day after fellow supermarket Tesco posted a 4.3% rise in quarterly sales and said it had made a “solid” start to its financial year.
Meanwhile, Sainsbury’s, which is Britain’s third-largest supermarket, has confirmed it is planning to raise £445 million to step-up its expansion programme. It will raise the funds via a placing of £255 million of new shares and an offering of convertible bonds worth £190 million.
According to Justin King, Sainsbury’s chief executive, the funds will provide the retailer with the “financial flexibility” to grow “further and faster”. It plans to take advantage of the economic downturn to find space for new stores.
The group said it had agreed to acquire almost a dozen stores from the Co-operative Group for £29 million. The stores are on top of the 24 stores it purchased from the group earlier this year, following the Co-op’s acquisition of Somerfield.
While Mr King said he remains cautious about the economy, he said the investment will create the chain’s “fastest period of growth since the early 1980s”.
The group has been benefiting from the economic downturn and is gaining customers from upmarket chains such as Marks & Spencer and Waitrose.