LONDON - Sainsbury will add 100 convenience stores to its 335 small neighborhood stores this financial year, The Telegraph reports. Last year, the supermarket chain opened 51 convenience stores.
Sainsbury CEO Justin King said that with the four biggest grocery chains having less than a 15 percent combined share of the convenience store market, there is a "significant growth opportunity" for Sainsbury. The company will open more than 100 convenience stores during the next financial year, a pace that will continue in years following.
Pretax profit soared 18 percent to $902 million during the year ending March 20, more than the median estimate by analysts. Its shares climbed 4.3 percent, the highest intraday rise since November.
However, King cautioned that future trading still looks rough, pointing to the slowing of sales growth for Wm Morrison as indicative of the market. "We are seeing the whole market slowing," he said.
Part of that slowing can be attributed to high fuel costs. "Fuel price inflation has had a very significant impact on consumers. Recently is has been 120p or so a litre compared to 99p last year. That is affecting the total weekly budget," said King.
Also this year, Sainsbury will expand 20 of its supermarkets and 20 new grocery stores.