Sainsbury (j) Share Discussion Threads

[loganair] 01/7/2020 12:45

1970's to mid 1990's Sainsbury had a c8% margins as did Tesco's during the 1980's and 1990's now both these supermarkets run at about c2% margins.


M&S are even worse off as in the early 1990's they were the first retailer to make £1bln in profits ($5bln in todays money) while today they can barely make £500mln.

[muffinhead] 01/7/2020 12:42

lol

we're in the money bye bye

hello boys, we're on a hamster wheel

[spob] 01/7/2020 12:23

This company was making near 800m a year on roughly 10 Billion sales about 30 years ago

Now they make almost nothing on 30 Billion in sales


Sainsburys reminds me of a mouse running on a treadmill

lots of activity

running very fast

but going nowhere

[loganair] 01/7/2020 12:03

John Moore, senior investment manager at Brewin Dolphin, commented: The ‘buy at Argos and collect at Sainsbury’s217; strategy worked well during lockdown and this is likely to accelerate a review of the Argos property estate in time, which may deliver some cost savings and efficiencies.'

'Supermarkets have been relatively resilient throughout the pandemic,' added Moore. He noted they are 'one of the few businesses that can continue to operate meaningfully, but the key questions from here are around costs and business adaptability in a changing retail environment.'

'There is still work to do for Sainsbury's, but it meets these challenges in good financial shape.

[loganair] 01/7/2020 12:02

Sainsbury's new boss should turn the dividend tap back on now Aldi and Lidl are back in their box:


At last, some bad news for the German supermarket discounters.

Aldi and Lidl have been getting a pasting in the grocery wars over the coronavirus crisis months, to the advantage of our home-grown supermarkets. Most notable beneficiary? Turns out to be Sainsburys.

The discounters have suffered for two reasons: firstly, they can’t do online because it’s too expensive for their cut-price model. Second, in our terrified state of recent months, we Brits have been trying to do as few visits to the supermarkets as possible. That has meant a preference for doing all our shopping at a one-stop bog roll-to-barbecues shop like Sainsbury’s rather than topping up by hunting for bargains at Lidl.

Sainsbury’s online home delivery orders have pretty much doubled over the past quarter in number, with people buying more in each transaction. That makes for great revenue numbers, but the impact on profit margins waits to be seen.

The company says its online operation would have made a profit for the past three years if it had been a standalone business, but still refuses to say how much. The suspicion is, not a lot.

More profitable will be click and collect, which has also boomed in the big behavioural Covid shift.

All this brings in an interesting dynamic for the property end of the business. The story with big grocers for a decade and more has been about ditching megastores for inner city convenience shops.

Now, Sainsbury finds its bigger sites are vital as most customers are staying away from the city as they work from home and the big stores serve the online division.

New chief Simon Roberts tempered any share price boost today with a rightly cautious note on the economy (so temper your enthusiasm about Argos). But the longer term trends are in his favour. Time to pay the dividend Sainsbury’s deferred in April.

[spob] 01/7/2020 11:54

Penny for the Guy

Anyone here expecting them to declare a final and interim dividend on Guy Fawkes Day

[spob] 01/7/2020 11:47

strong hold ?

in other words... sell

Lol

[loganair] 01/7/2020 10:33

Julie Palmer, partner at Begbies Traynor, said the new chief executive now faced the task of "navigating the supermarket through the murky economic waters of covid-19".

"Although grocery sales have spiked during the past few months, the increased costs retailers have had to absorb from disruptions to the supply chain and the implementation of social distancing measures have rocked the boat, with the business's profitability taking a hit," she said.

Richard Hunter, head of markets at Interactive Investor, said Sainsbury's had demonstrated "an ability rapidly to evolve within a new environment".

"If the pandemic has marked a sustained change in consumer behaviour, Sainsbury's will be well placed to benefit. In particular, its digital capabilities and the possibility that shoppers might lean more towards the click-and-collect option in future would play directly into the group's hands," he added.


In all, Sainsbury’s has had a largely successful quarter as it has demonstrated an ability rapidly to evolve within a new environment. Initial reaction to this progress has been positive, injecting some life into a share price performance which has remained largely unchanged over the last quarter.

Over the last year, the group has displayed a rather more defensive quality, with the shares having risen 6.5%, which compares to a decline of 18% for the wider FTSE 100 index. Even though Sainsbury’s may not be the preferred play in the sector, the market consensus of the shares as a ‘strong hold’ could come under some upward pressure after this update.

[loganair] 01/7/2020 08:39

The profit hit from the crisis was expected to be more than £500m, as previously guided, but it would be "broadly offset by business rates relief and stronger grocery sales", Sainsbury's said.

The company has not taken up Government support in the form of the furlough schemes or delayed VAT payments, although it has accepted £450 million in business rates relief for the year.

Outlook:

Sales growth has been stronger than base case assumptions outlined in April, helped by good weather. However Sainsbury's is cautious about the sales trajectory for the rest of the year given the weather benefit to date and a likely further weakening of consumer spending.

[loganair] 01/7/2020 08:35

Sainsbury’s in ‘strong financial position’ after more than doubling online sales
Supermarket giant Sainsbury’s has announced a higher than expected sales performance despite the disruption caused by COVID-19.

The firm has reported a 10.5 per cent increase in grocery sales, as well as more than doubling its online revenue, since the coronavirus crisis began.

In addition, the company’s clothing and fuel sales have started to recover “more quickly than expected” and its financial services business has an improved capital position compared with the year end.

[buywell3] 01/7/2020 08:16

P/E of 35.98

Seems a tad rich to buywell IMO

[rolo7] 01/7/2020 08:14

Got to include fuel so now q2 sales will be down v last year noone driving.

[unastubbs] 01/7/2020 08:13

analysts call 8.20am

[tardelli2] 01/7/2020 08:05

Don't include fuel then .

[rolo7] 01/7/2020 07:57

Sales down if you include fuel!?

[leadersoffice] 01/7/2020 07:22

Given the climate at the moment...Sainsbury's weathering the storm. I should imagine the other food retailers with exception to M&S will have shown resilience. Not looking good sat in my portfolio in negative territory but over time, this will recover.

[ny boy] 30/6/2020 11:10

Resistances in play..

Resistance1: 214.53p. Resistance2: 250.57P

[ny boy] 30/6/2020 11:03

Looks like we are finally seeing some upward movement after yonks of consolidation, defensive qualities kicking in

[unastubbs] 28/6/2020 17:36

this board is quiet given that there's a trading statement on wednesday! anyone like to venture an opinion on what's in ... store?

www.theguardian.com/business/2020/jun/27/sainsburys-new-boss-sales-soaring-expecting-bumpy-ride-simon-roberts

www.expressandstar.com/news/uk-news/2020/06/28/sainsburys-set-to-post-reassuring-sales-jump-in-new-chiefs-first-update/

i'd really like some guidance on the dividend from the new ceo. don't suppose i'll be any the wiser ;)

[lfc19] 26/6/2020 12:27

[b]LFC!!![/b]

[spob] 26/6/2020 12:10

Clearly Sainsburys shops don't have that much free space

because the in-store Argos shops I have seen are tiny

and have very little warehouse space

meaning they only stock around 20% of the full argos range



I know what the directors thinking is, in regard to the stand-alone Argos shops

but customers are not directors. They will do what they want to do

[loganair] 26/6/2020 12:02

1. Many of the large Sainsbury's stores have too much spare space, so bring in Argos to fill this space.

2. By doing so Sainbury's also hopes to increase foot fall into their supermarkets.

3. Many of the in house Argos's are at the back of the Sainsbury's therefore they are making people who shop at Argos walk through Sainsbury's hoping that these people who may not be Sainsbury's shoppers, buy their food from Sainsbury's.

4. This was one of the main points about trying to merge with Asda. Asda only have large stores which are ripe to put Argos's in, even said as much in the merger document at the time. By doing this could me worth as much as £200m to £300m a year in extra sales for Argos, while bringing in a further £100m of saving for Argos.

[spob] 26/6/2020 11:34

Sure you can close some stand-alone argos shops if they are losing money

but if you close too many, there comes a tipping point where the brand dies and becomes irrelevant in the eyes of the average argos customer

[spob] 26/6/2020 11:27

yes i'm quite sure it works for some

but this is a numbers game

and you have to weigh up the numbers for the full range of Argos customers

[spob] 26/6/2020 11:25

remember that if you dont need your item "right now"

and you don't mind waiting for it

then you may aswell buy it cheaper on ebay anyway and get it delivered for free