Sainsbury’s focus is on strategy, not takeover frenzy

imageStock Markets11 minutes ago (Jul 06, 2021 04:41AM ET)

(C) Reuters. Simon Roberts, Retail and Operations Director of Sainsbury’s, poses for a portrait at the company headquarters in London, Britain, May 1, 2019. REUTERS/Toby Melville/Files

By James Davey

LONDON (Reuters) -The boss of Sainsbury’s said on Tuesday his focus was on delivering the British supermarket group’s strategy rather than the takeover frenzy that has gripped the sector.

Shares in Sainsbury’s are up 24% so far this year, buoyed by bid speculation.

That started in April when Czech billionaire Daniel Kretinsky raised his stake in Sainsbury’s to just under 10% and has been fuelled over the last two weeks by a bid battle for rival Morrisons.

Asked by reporters if Sainsbury’s board had received any takeover approaches, Roberts said: “If we had anything to update on, we’d be updating on it, so we’ve nothing to update you on.”

“I’m not going to speculate on where things are in the wider sector,” he said.

“We’re very focused on our plan. We laid out a (strategic) plan in November to really deliver improvements for our customers and improve the value that we can create for our shareholders.”

Roberts said better-than-expected trading in Sainsbury’s latest quarter and a raised full year profit outlook showed that plan was working.

Sainsbury’s which trails market leader Tesco (OTC:TSCDY) in annual sales, said like-for-like sales, excluding fuel, rose 1.6% in the 16 weeks to June 26, its fiscal first quarter.

That was ahead of analysts average forecast of a fall of 1.7% and compared to a rise of 11.3% in the previous quarter.

The sharp slowdown in growth reflected a tough comparison with the same quarter last year when shoppers stocked up for a first COVID-19 lockdown.

Sainsbury’s said sales of grocery, general merchandise and clothing were all higher than its expectations throughout the quarter. It said it outperformed competitors and grew market share.

It said it had further tough comparative numbers ahead as pandemic restrictions continue to ease and customer behaviour normalises.

Sainsbury’s forecast underlying pretax profit of at least 660 million pounds ($917 million) in the 2021-22 year, up from previous guidance of about 620 million pounds and the 356 million pounds made in 2020-21.

Shares in Sainsbury’s were up 0.3% at 0807 GMT.

Sainsbury’s focus is on strategy, not takeover frenzy

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