Sainbury issued a promising trading statement last week but why no mention of margins? It's not alone with all the other multiples reluctant to cover margins in their quarterly updates. Good see that Marks gives them a mention.
Commentary at www.investorschampion.com

Trading Statement

Fourth Quarter Trading Statement for 10 weeks to 16 March 2013

Strong sales, reflecting continued market outperformance

· Total sales for fourth quarter up 7.1 per cent (6.3 per cent excluding fuel)
· Like-for-like sales for fourth quarter up 4.2 per cent (3.6 per cent excluding fuel)
· Like-for-like sales for year up 2.1 per cent (1.8 per cent excluding fuel)
· Weekly customer transactions increased by over 800,000 year-on-year
· Achieved target of c.5% gross space growth for the year

Broker snap: UBS hikes forecasts for Sainsbury ahead of results
Thu 02 May 2013


Broker snap: UBS hikes forecasts for Sainsbury ahead of results LONDON (SHARECAST) - Another solid increase in profits is expected from Sainsbury when it reports its first-half report on May 8th, according to UBS which lifted its estimates for the supermarket giant on Thursday.

The broker, which kept a 'buy' rating for the stock, lifted its full-year profit before tax estimate by 5.2% to £749m, ahead of the consensus forecast for £746m.

"This represents a good outturn given industry demand conditions have remained depressed while key competitors have experienced profitability declines in the equivalent period," UBS said.

Furthermore, the broker said that guidance for the full-year ending March 2014 is likely to follow the same pattern as the year just gone. It expects mid-single-digit sales growth and ongoing tight cost control to result in another year of "decent progress in earnings".

"In our view Sainsbury’s returns metrics have remained impressively resilient (flat since FY10) given the abnormally weak industry backdrop (ie persistent volume declines) and a period of heavy capex/space expansion which naturally has a dilutive effect given property lag effects and store maturity profiles.

"Looking ahead we think it is plausible that Sainsbury’s returns will resume their upwards trajectory in FY14, providing tangible validation for the investment strategy."

The target price for the shares has been lifted from 400p to 425p.

The stock was up 0.52% at 384p by 10:59.

Sainsbury's Bank

In accordance with DTR 1 1.3.6, the Company made the following statement at 3pm on Sunday 5 May 2013:

J Sainsbury's notes the press speculation concerning Sainsbury's Bank and confirms it is in advanced negotiations with Lloyds Banking Group to take full ownership of Sainsbury's Bank. A further announcement will be made in due course.


END

Final Results

Financial summary
· Total sales (inc VAT) up 4.6 per cent to £25,632 million (2011/12: £24,511 million)
· Total sales (inc VAT, ex fuel) up 4.3 per cent, like-for-like sales (inc VAT, ex fuel) up 1.8 per cent
· Underlying profit before tax up 6.2 per cent to £756 million (2011/12: £712 million)(1)
· Underlying basic earnings per share up 9.3 per cent to 30.7 pence (2011/12: 28.1 pence)(2)
· Return on capital employed of 11.2 per cent (2011/12: 11.1 per cent)(3)
· Proposed full year dividend of 16.7 pence, up 3.7 per cent, cover 1.83 times (2011/12: 16.1 pence, cover 1.75 times)

Statutory
· Revenue (ex VAT, inc fuel) up 4.5 per cent to £23,303 million (2011/12: £22,294 million)
· Profit before tax down 1.4 per cent to £788 million (2011/12: £799 million)(4)
· Profits excluded from underlying results down from £87 million to £32 million, reflecting fewer property disposals
· Basic earnings per share up 1.9 per cent to 32.6 pence (2011/12: 32.0 pence)

Operating highlights
· Outperformed the market, increasing market share to 16.8 per cent, the highest for a decade(5), driven by 33 consecutive quarters of like-for-like sales growth
· Delivered over £100 million of operational cost savings
· Improved underlying operating margin by 2 bps to 3.56 per cent (2 bps at constant fuel prices)
· Price perception continues to improve, driven by competitive pricing, targeted promotions and offers via Nectar and Brand Match
· Awarded:
o Supermarket of the Year, for the fifth time in seven years - Retail Industry Awards
o Convenience Chain of the Year, for the third year in a row - Retail Industry Awards
o Online Retailer of the Year - The Grocer
o Employer of the Year - Retail Week
o World Sector Leader, for the sixth consecutive year - Dow Jones Sustainability Index

Strategy highlights
· Great food:We continue to invest in our supply chain and sourcing credentials, including initiatives such as our Farmer Development Groups and Fairtrade. Own-brand sales are outperforming the market and growing faster than brands, and the re-launch of our core range, by Sainsbury's, is now complete. Over 20,000 colleagues have benefited from City & Guilds accredited training in our seven food colleges.
· Compelling general merchandise & clothing: Our non-food offer goes from strength to strength, growing at over twice the rate of our food business and gaining market share. In February, we reached the milestone of £1 billion annual sales from general merchandise, reflecting the investment we have made in the quality of our offer, in-store experience and non-food space.
· Complementary channels & services: Our established multi-channel strategy continues to enable customers to shop where, when and how they want. Annual grocery online sales are almost £1 billion and convenience store sales are now over £1.5 billion. Today we have announced that an agreement has been reached to take full ownership of Sainsbury's Bank by acquiring Lloyds Banking Group's 50 per cent shareholding for £248 million, which comprises a cash consideration for the shares of £193 million(6) and the purchase of £55 million of loan stock. The Bank continues to make strong progress, with our share of joint venture post-tax profit up 38 per cent from £16 million to £22 million.
· Developing new business: Pharmacy continues to be an area of growth with over 270 now in stores, complemented by 37 NHS GP or nurse-led surgeries in-store; we also operate outpatient pharmacies in three major hospitals. We announced I2C, a joint venture company with Aimia, owners of Nectar, and acquired a majority stake in Anobii e-book platform, now operating as eBooks by Sainsbury's.
· Growing space & creating property value: During the year we opened one million sq ft of gross new space, adding 14 supermarkets, eight extensions and 87 convenience stores. Property profits were £66 million and our portfolio is now valued at £11.5 billion. Over the past five years, we have disposed of £1.3 billion of property, monetising property profits of £341 million, while the value of our portfolio has increased by £4 billion.

JP Morgan Cazenove Underweight 0.00 360.00 360.00 Reiterates

Nomura Neutral 0.00 355.00 380.00 Reiterates

Morgan Stanley Overweight 0.00 400.00 400.00 Retains

Charles Stanley Accumulate 0.00 - - Reiterates

Tradenext Buy 0.00 500.00 500.00 Reiterates

Credit Suisse Underperform 0.00 285.00 285.00 Reiterates

Espirito Santo Execution Noble Neutral 0.00 400.00 400.00 Retains

Morgan Stanley Overweight 0.00 400.00 400.00 Retains

Top of the shops: Sainsbury is Morgan Stanley's pick from the basket
By Ian Lyall May 22 2013, 12:45pm Aubin points out the UK’s major grocers are spending significantly more expanding their floor-space than their European rivals, with selling space now exceeding grocery volumesAubin points out the UK’s major grocers are spending significantly more expanding their floor-space than their European rivals, with selling space now exceeding grocery volumes

Sainsbury (LON:SBRY) is the only share worth owning in the UK food retail space, according to Morgan Stanley, which has given a rather dour assessment of the sector.

“Given likely further compression of return on capital invested for the sector over the next two years, we view the UK food retail sector as unattractive at current valuations,” said analyst Edouard Aubin in a note to clients.

Market leader Tesco (LON:TSCO) and Morrisons (LON:MRW) are rated ‘underweight’ by Morgan Stanley, while it remains ‘overweight’ Sainsbury.

Aubin points out the UK’s major grocers are spending significantly more expanding their floor-space than their European rivals, with selling space now exceeding grocery volumes.

He says he expects the industry to “remain rational from a pricing standpoint”, which in layman’s terms means the analyst doesn’t expect a margin-sapping price war for customers.

This, Aubin said, is principally because Tesco is attempting “protect its P&L” (profits). However he warned: “[We] think something will nevertheless have to give as supply outstrips demand, and we expect further decline in asset turn.”

The research suggests that of the ‘big four’ supermarket groups (the fourth is Asda, owned by Wal-Mart), Tesco (LON:TSCO) has the most to lose from the current shake-out in the sector and as its rivals continue to flex their muscle.

Unsettling for the management of Britain’s largest retailer is research from Morgan Stanley that suggests Tesco has seen the sharpest decline of the majors in the value for money ratings.

The American bank’s price target for Tesco is 310 pence (current price 383 pence), while it said Morrisons is worth 225 pence (281 pence) and Sainsbury 400 pence (387 pence).

“We believe that Sainsbury will continue to outperform the market in terms of sales momentum given that, in Brand Match, it has found a way to tackle its biggest problem – price perception,” Aubin added.

“However, as our latest Alphawise survey showed, there is still a large gap between Sainsbury’s price perception and price reality.

“As such, we think there is still more to go for (Sainsbury still has lower grocery sales per sq ft than its main competitors Tesco, Morrisons’ and Asda) despite operating a larger share of its store network in the richest part of the UK).”

Sainsbury (LSE: SBRY.L - news) 's

We'll have a first-quarter update from J Sainsbury on Wednesday, and hopes are high for this year. The UK's second biggest supermarket posted nice full-year results for the year to March 2013 in May, revealing a 4.6% rise in sales with underlying pre-tax profit up 6.2%. Underlying earnings per share rose 9% to 30.7p, enabling a full-year dividend of 16.7p per share -- and that provided a yield of 4.6%.

Forecasts for this year paint a similar picture, with a 6% rise in earnings per share predicted. There's also a 4.7% rise in the dividend to about 17.5p penciled in, which should be well covered, and it would provide a similar 4.6% yield on the current price.

And that price? Well, it's slipped a bit over the past couple of weeks along with the FTSE in general, but at 363p it's still up 25% over the past 12 months, and is ahead of the index.

Trading Statement

Solid sales performance in a challenging market

· Total sales for first quarter up 3.6 per cent (3.3 per cent excluding fuel)

· Like-for-like sales for first quarter up 0.7 per cent (0.8 per cent excluding fuel)

· Market share up 0.2 percent to 16.8 per cent

· Winner of the prestigious Grocer 33 Customer Service and Availability Awards

Questor share tip: Hold J Sainsbury as it powers ahead
J Sainsbury is the best performing supermarket this year. Questor says hold.
Garry White By Garry White
6:00AM BST 16 Jun 2013

The supermarket’s first-quarter update revealed same-store sales rose 0.7pc, or 0.8pc excluding fuel. This represented a quarter-on-quarter slowdown from

3.6pc, but it is a much better performance than its rivals. Such “lumpy” quarters are to be expected, but it is reassuring that the group maintained its guidance of like-for-like sales increasing by 1pc to 1.5pc over the year.

One particular bright spot is the success of its own-brand products. Sales of its high-end “Taste the Difference” range jumped 10pc and crossed the £1bn sales mark for the first time. This helped to boost the group’s market share by 0.2 percentage points to 16.8pc.

Non-food continues to grow at more than twice the rate of food. Rivals have had problems with their non-food offering, but Sainsbury’s is sensibly not focusing on the low-margin, competitive electronic goods space, but on items such as homewares, cooking utensils and greetings cards, which have solid margins.
Indeed, in last week’s statement, management said that its non-food offering was helping to boost overall market share.

For the rest of the year, trading is likely to remain tough, but Sainsbury’s management is delivering. Questor recommended a purchase below 300p when the shares were yielding about 5.5pc. They have recovered to trade on a multiple of 11.6 and a forward yield of 4.7pc. Hold.

Any particular reason for the advance this afternoon?
393 plus as I write.

Here's the reason: UBS has added the supermarket to its Global top 40 list.

Trading Statement

Second Quarter Trading Statement for the 16 weeks to 28 September 2013

Strong sales delivering continued outperformance

· Total sales for second quarter up 5.0 per cent (4.6 per cent excluding fuel)

· Like-for-like sales for second quarter up 2.1 per cent (2.0 per cent excluding fuel)

· Total sales for the first half up 4.4 per cent (4.0 per cent excluding fuel) and like-for-like sales up 1.5 per cent (1.4 per cent excluding fuel)

Sainsbury's takes price comparison spat with Tesco to high court

LONDON | Wed Oct 30, 2013 5:40am GMT
(Reuters) - Supermarket J Sainsbury will take its spat over price comparisons with Tesco to Britain's high court, challenging a ruling by the advertising watchdog in favour of its rival.

Britain's supermarkets are battling intensely for market share in tough economic conditions. Advertising is a major battleground.

Interim Results

Financial summary(1)
· Total sales (inc VAT, inc fuel) up 4.4 per cent to £13,953 million (2012/13: £13,365 million)
· Total sales (inc VAT, ex fuel) up 4.0 per cent
· Like-for-like sales (inc VAT, ex fuel) up 1.4 per cent
· Underlying profit before tax(2) up 7.0 per cent to £400 million (2012/13: £374 million)
· Underlying basic earnings per share(3) up 9.2 per cent to 16.6 pence (2012/13: 15.2 pence)
· Return on capital employed(4) of 11.4 per cent (2012/13: 10.8 per cent)
· Return on capital employed excluding pension fund deficit(5) of 10.5 per cent (2012/13: 10.3 per cent)
· Interim dividend of 5.0 pence, up 4.2 per cent (2012/13: 4.8 pence)

Statutory
· Revenue (ex VAT, inc fuel) up 4.3 per cent to £12,684 million (2012/13: £12,160 million)
· Profit before tax up 9.1 per cent to £433 million (2012/13: £397 million)
· Basic earnings per share up 8.5 per cent to 17.9 pence (2012/13: 16.5 pence)

Operating performance
· Outperformed the market, increasing market share to 16.8 per cent(6), the highest for a decade, completing 35 consecutive quarters of like-for-like sales growth
· Excellent customer service levels winning 15 out of 28 Grocer 33 Service and Availability awards
· Operational cost savings of around £55 million, on track for around £100 million for the full year
· Improved underlying operating margin by 7 bps to 3.47 per cent (up 6 bps at constant fuel prices)
· Supermarket of the Year (6th time in eight years) and Convenience Chain of the Year (4th consecutive year), Retail Industry Awards. Online Retailer of the Year (2nd consecutive year), Grocer Gold Awards
· FTSE 100 Business of the Year, National Business Awards
· Defined benefit pension fund triennial valuation complete resulting in funding deficit of £592 million, a £635 million improvement on the 2009 valuation. Recovery plan agreed in 2009 remains unchanged

Strategy
· Great Food:Own-brand growing at over twice the rate of branded goods, by Sainsbury's re-launched and Taste the Difference showing double-digit growth. Achieved 100 per cent British fresh pork, to complement our existing 100 per cent British fresh chicken and 100 per cent British or Irish fresh beef
· Compelling General Merchandise and Clothing: Strong growth at around twice the rate of food sales. Successfully re-launched Tu clothing brand and extended by Sainsbury's brand into general merchandise
· Complementary Channels and Services: Groceries online growing at over 15 per cent, with over £1 billion in annualised sales and orders regularly exceeding 180,000 a week. Plans announced for an online fulfilment centre at Bromley-by-Bow. Convenience growing at over 20 per cent, opening around two new stores each week. Sainsbury's Bank remains on track to move to full ownership by the end of January 2014
· Developing New Business: Launched Mobile by Sainsbury's and opened fourth hospital out-patient pharmacy
· Growing Space and Creating Property Value: Opened 393,000 sq ft of space over the half-year, comprising six supermarkets, 50 convenience stores and two extensions. Property profits were £18 million. Property value up £0.3 billion from March 2013 to £11.8 billion. Following a review of our property pipeline we have identified some sites where we no longer wish to build a supermarket, resulting in a £92 million impairment within one-off items

Sainsbury Market Share Slips for First Time Since January

LONDON--J. Sainsbury PLC (SBRY.LN), the U.K.'s third largest supermarket chain, saw its market share fall for the first time since January, as discount retailer Aldi's rise continues unabated with almost a third of British households shopping in its stores over the past 12 weeks.

"The number of shoppers visiting Aldi has grown by 16% year-on-year at the same time as the average basket size has swelled by nearly 15%," said Edward Garner at Kantar Worldpanel, which monitors the household grocery purchasing habits of 25,000 demographically representative households in the U.K. "In fact, almost a third of British households have shopped in Aldi in the past 12 weeks," he added.

Trading Update Tomorrow.

Barclays Capital Overweight 362.55 440.00 440.00 Reiterates
Bank of America Merrill Lynch Underperform 362.55 430.00 350.00 Downgrades
HSBC Neutral 362.55 415.00 415.00 Reiterates
Morgan Stanley Overweight 362.55 415.00 415.00 Retains
Deutsche Bank Hold 362.55 410.00 410.00 Reiterates

Trading Statement

Third Quarter Trading Statement for the 14 weeks to 4 January 2014

Good sales performance in a tough market

· Total sales for third quarter up 2.5 per cent (2.7 per cent excluding fuel)

· Like-for-like sales for third quarter flat (0.2 per cent excluding fuel)

· 28 million customer transactions in the seven day run up to Christmas

· Strong sales growth in Taste the Difference over the Christmas period

Barclays Capital Overweight 361.15 440.00 440.00 Reiterates

Directorate Change

Sainsbury's announces Justin King to step down;
Mike Coupe appointed CEO from 9 July 2014

Sainsbury's today announces that Justin King has decided to step down in July 2014 after 10 years as CEO, and that Mike Coupe, currently the Group Commercial Director, will succeed him as CEO.

David Tyler, Chairman said: "Justin is a truly exceptional leader, who has reshaped Sainsbury's during his 10 years as CEO, as well as playing a leading role in the sector and wider business world. The Board thanks him for his outstanding achievements in 'Making Sainsbury's Great Again'. He leaves a lasting legacy, with the Company stronger than ever.

"We are delighted to appoint a CEO of Mike's unique talent and experience as Justin's successor to lead the next chapter of Sainsbury's history. No one knows Sainsbury's - or the industry - better than Mike. He has worked hand-in-hand with Justin over the past decade and has a proven track record of success making him the natural choice to take the Company forward."

Justin King, CEO said: "This was not an easy decision for me to make, and in truth it will never feel like the right time to leave a company like Sainsbury's. It has been a privilege to have led the Company for the past 10 years and I am incredibly proud of our achievements in that time. It is the 157,000 colleagues that make Sainsbury's so special and I would like to thank them for their amazing efforts over the last decade in making Sainsbury's great again. I am confident that under Mike's leadership the business will go from strength to strength."

Mike Coupe, CEO designatesaid: "It's an absolute honour to be appointed as the new CEO of Sainsbury's in this, the Company's 145th year, and at a time when thanks to Justin's leadership, we have been consistently outperforming the market. I very much look forward to building on that success for our customers, colleagues, suppliers and shareholders."

Supermarkets generally weak today.
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