Weekly Retail & Leisure News - 09 May, 2016
In positive signs for the grocery market, both Morrisons and Sainsbury’s have released improving results last week. Morrisons reported positive LFLs for Q1 with sales up 0.7% in the 13 weeks to May 1. Food to go sales (up 17%) and new self-scan check outs contributed to improved customer experience, and helped growth. However, total sales were down by 1.8% following the recent closure of 28 supermarkets and 140 convenience stores. Sainsbury’s LFL results were down marginally to 0.9% in the year to March 12. However the grocer’s full-year pre-tax profits were up, hitting £548m. Online and convenience remains a focus for Sainsbury’s, adding 69 convenience stores over the year.
In the wider grocery market, we have seen a slowdown in growth since Easter, from 1.1% reported last month, to 0.1% in April, according to Kantar World Panel. The discounters Lidl and Aldi remain the big winners with sales up by 15.4% and 12.5% respectively. Competition is forcing the Big Four to innovate and explore new sales channels. Morrisons’ results follow the recent announcement of its tie up with Amazon, while Sainsbury’s has pledged to double its stores offering Click & Collect.
Elsewhere, Next reported a dip in sales to 0.2% for Q1, with uncharacteristic weather partly to blame for the negative results. Next’s home and furniture sales increased 7%, and its Directory business, which includes online and catalogue sales, rose 4.2%. The retailer has now lowered its guidance for sales and profits for the year.
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Director, Head of Retail Research (UK & EMEA)
+44 (0)20 3147 1155
Director, Head of UK Retail & Leisure
+44 (0)20 7318 7838
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