UK retailer Sainsbury’s has reported a rise in annual its pre-tax profit to £898 million ($1.524 billion) for the year ending 15th March, more than 16% higher than its previous annual profit of £772 million ($1.310 billion).
Like-for-like sales, however, which excludes trading at new stores & fuel, rose by just 0.2% against the backdrop of what Sainsbury’s described as a “tough retail environment”.
Sainsbury’s Chief Executive Justin King said: “While the general economic outlook is showing some signs of improvement, conditions in the food retail sector are likely to remain challenging for the foreseeable future as customers continue to spend cautiously”.
“We remain committed to investing for the future and continue to see significant opportunities for growth. We remain confident that our differentiated offer, supported by the ‘value of values’, Nectar data and Brand Match, will allow us to outperform our peers in the year ahead,” he added.
The retailer also reported that sales of general merchandise were growing twice as fast as food. Its relaunched clothing brand had helped generate sales of £750 million ($1.272 billion), it said.