J Sainsbury Plc (LON:SBRY) has announced its preliminary results for the 52 weeks ended 4 March 2023.
Two years into our Food First plan, we are a fundamentally stronger business. We have made bold choices to reduce costs, make Argos and Tu more profitable and resilient, grow profits at Nectar and strengthen our balance sheet. We have reinvested the benefits in our food business, prioritising value, customer service and innovation, which is driving improved market share performance1. This has also given us the financial flexibility to make balanced choices, investing to help customers and colleagues, while also delivering results at the top end of expectations.
Financial highlights
· Retail sales up 5.2%, ex. fuel sales up 2.0%. Statutory Group sales (ex. VAT) up 5.3%. Q4 ex. fuel retail sales up 7.1% (7.8% like-for-like)
· Grocery sales up 3.0%, driven by inflation and improved market share performance. Q4 grocery sales up 7.4%
· General Merchandise (GM) sales down 0.4%, with Argos gaining share in a weak general merchandise market. Q4 GM sales up 7.6% (Argos sales up 9.3%)
· Underlying profit before tax of £690 million, down 5% and at the top end of £630 million to £690 million guidance range. Up 18% versus 2019/20 pre-pandemic UPBT of £586 million. Year-on-year decline reflects annualisation of COVID-19 driven grocery volume, investment in the customer proposition and operating cost inflation, partially offset by operating cost savings and lower finance charges
· Statutory profit before tax of £327 million versus £854 million last year. Impacted by non-cash asset impairments, driven by a higher discount rate, and one-off income from legal settlements in the prior year
· Retail free cash flow £645 million
· Year end net funds, excluding leases, of £144 million, a £285 million improvement. Net debt including leases improved by £415 million to £6,344 million
· Underlying earnings per share 23.0 pence, down 9%. Basic earnings per share 9.0 pence, down 70%
· Proposed final dividend of 9.2 pence, full-year dividend of 13.1 pence, in line with last year
· Outlook: At this early stage of the year, we expect UPBT between £640 million and £700 million in FY2023/24 and we continue to expect to generate at least £500 million of Retail free cash flow
Simon Roberts, Chief Executive of J Sainsbury plc, said: “We really get how tough life is for so many households right now which is why we are absolutely determined to battle inflation for our customers. Our focus on value has never been greater and we have spent over £560 million keeping our prices low over the last two years. As a result, we are now the best value compared to our competitors that we have been in many years and we are delivering improved market share performance in Sainsbury’s and Argos.
“We are two years into our plan to put food back at the heart of Sainsbury’s and have focused our efforts on reducing costs right across the business, which has enabled us to make the right decisions for our colleagues and customers. At the same time, we have improved the performance and profitability of Argos, Tu, Nectar and Financial Services so that we can invest further in the areas that customers and colleagues care about most.
“Our colleagues do a fantastic job serving our customers every day and we know that they are also dealing with the impact of the rising cost of living. That’s why, over the last 12 months, we took the decision to invest £225 million in supporting colleagues including raising colleague pay three times, becoming the first major supermarket to pay our people the Living Wage across the whole country and providing free food at work and increased colleague discount. The results we have achieved this year are testament to the outstanding contribution across our entire team. I want to thank every one of my colleagues for their dedication and hard work.
“We continue to work closely with our suppliers and farmers and I am grateful for their support in what has been another difficult year for food supply chains. We know just how vital the agriculture industry is not only to Sainsbury’s, but to the country as a whole and this is why we have made the choice to give £66 million of additional support to British farmers over the last year.
“We made these very deliberate decisions and investments because they make our business stronger, but more importantly because they are simply the right thing to do. While there is still much to be done and there is no doubt that the year ahead will remain challenging, I’m confident we will continue to deliver for our customers, colleagues, communities and shareholders.”
Strategic highlights
· Food First: Customers want low prices, exciting new products and great customer service. This is where we are focusing our time, energy and investment and is why more customers are choosing to shop with us2. We have:
o Invested over £560 million in keeping prices lower over the last two years, £10 million more than the commitment we announced in December, helping us significantly improve our price position against all our competitors by as much as 16 per cent3
o Launched Nectar Prices, offering discounts to every Nectar customer in supermarkets and online, building on Your Nectar Prices which offers personalised discounts. The most active Your Nectar Prices users are saving almost £200 a year on their shopping4
o Exceeded our innovation target and launched more Taste the Difference products, helping to win market share around big events5 as customers increasingly celebrate at home
o Invested record amounts to increase colleague pay, provide free food and improve discount, driving up colleague and customer satisfaction scores
· Brands that Deliver: We have significantly improved profitability across our brands, creating £145 million6 more firepower to invest in our core food business. We have:
o Grown our Nectar digital users to 11 million and now have over 18 million Nectar members. Nectar360 is on track with its plan to deliver at least £90 million incremental profit by March 2026
o Transformed the Argos sales and cost base, making the business considerably more profitable and more competitive than pre-pandemic. Argos has gained market share7 in a weak general merchandise market
o Launched more Habitat partnerships with third-party designers and delivered value market share gains in a number of homeware categories8
o Grown full-price sales to now make up 80 per cent of our Clothing sales, up 15 percentage points versus pre-pandemic whilst also extending our range of third party clothing brands to offer more choice and convenience
o Increased Financial Services profits, reflecting higher credit demand and travel money volumes
· Save to Invest: We are making tough but necessary decisions to simplify, prioritise and partner right across the business. These create cost savings that fuel investments in price, innovation and customer service. We have:
o Delivered more than £900 million of cost savings over the last two years, remaining on track to deliver £1.3 billion of cost savings over three years, doubling the run rate from the three years to FY2019/20
o Reduced our operating cost to sales ratio further, now 97 basis points lower than FY2019/20 despite significantly higher than anticipated operating cost inflation. Productivity improvements have driven a reduction in our labour cost to sales ratio despite significant investment in colleague wages
· Plan for Better: We are committed to playing a leading role in offering affordable high quality food that supports healthy and sustainable diets and helps customers reduce their impact on the planet. We have:
o Reduced absolute greenhouse gas (GHG) emissions within our operations to 461,692 tCO2e, a reduction of 38.2 per cent year-on-year. We were awarded an A rating for our Climate Change CDP submission for the ninth consecutive year and are the only UK food retailer to have achieved this
o Donated over 10 million meals through our partnership with Neighbourly since launching in 2021, preventing over 4,500 tonnes of food from going to waste
o Reduced absolute plastic packaging by 17.5 per cent from our baseline9. We are focused on reducing plastic packaging on high volume products and were the first retailer to vacuum-pack all beef mince, which will save over 450 tonnes of plastic a year
| Financial Summary | 2022/23 | 2021/22 | 2019/20 | YoY | Yo3Y |
| Statutory performance | |||||
| Group revenue (excl. VAT, inc. fuel) | £31,491m | £29,895m | £28,993m | 5.3% | 8.6% |
| Profit before tax | £327m | £854m | £278m | (62)% | 13% |
| Profit after tax | £207m | £677m | £170m | (69)% | 15% |
| Basic earnings per share | 9.0p | 29.8p | 6.7p | (70)% | 27% |
| Business performance | |||||
| Group sales (inc. VAT) | £35,157m | £33,355m | £32,394m | 5.4% | 8.5% |
| Retail sales (inc. VAT, excl. fuel) | £28,664m | £28,095m | £26,868m | 2.0% | 6.7% |
| Underlying profit before tax10 | £690m | £730m | £586m | (5)% | 18% |
| Underlying basic earnings per share10 | 23.0p | 25.4p | 19.8p | (9)% | 16% |
| Interim dividend per share | 3.9p | 3.2p | 3.3p | 22% | 18% |
| Proposed Final dividend per share11 | 9.2p | 9.9p | 7.3p | (7)% | 26% |
| Proposed Full-year dividend per share11 | 13.1p | 13.1p | 10.6p | – | 24% |
| Net debt10 | £(6,344)m | £(6,759)m | £(6,947)m | +£415m | +£603m |
| Non-lease net funds / (debt) | £144m | £(141)m | £(1,179)m | +£285m | +£1,323m |
| Return on capital employed10 | 7.6% | 8.4% | 7.4% | (80)bps | 20bps |
| Like-for-like sales performance | 2021/22 | 2022/23 YoY | |||||
| Q3 | Q4 | Q4 | FY | ||||
| Like-for-like sales (excl. fuel) | (4.5%) | (5.6%) | 7.8% | 2.6% | |||
| Like-for-like sales (incl. fuel) | 0.6% | 2.7% | 5.9% | 5.7% | |||
| Total sales performance | 2021/22 | 2022/23 YoY | 2022/23 Yo3Y | |||||||||
| Q3 | Q4 | Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | Q3 | Q4 | FY | |
| Grocery | (1.1%) | (1.6%) | (2.4%) | 3.8% | 5.6% | 7.4% | 3.0% | 8.7% | 10.1% | 12.5% | 12.4% | 10.8% |
| Total General Merchandise | (16.0%) | (21.1%) | (11.2%) | 1.2% | 4.6% | 7.6% | (0.4)% | (6.2%) | (3.6%) | (6.9%) | 1.4% | (4.9)% |
| GM (Argos) | (16.1%) | (20.4%) | (10.5%) | 1.6% | 4.5% | 9.3% | 0.1% | (4.5%) | (0.9%) | (5.0%) | 4.2% | (2.9)% |
| GM (Sainsbury’s) | (15.7%) | (24.1%) | (14.6%) | (1.3%) | 5.4% | (1.0)% | (2.9)% | (13.8%) | (15.5%) | (15.6%) | (11.8)% | (14.6)% |
| Clothing | (2.7%) | (9.3%) | (10.1%) | (0.2%) | 1.3% | (1.9)% | (3.0)% | 3.9% | 0.8% | (0.4%) | (8.6)% | 0.0% |
| Total Retail (excl. fuel) | (5.3%) | (6.2%) | (4.5%) | 3.1% | 5.2% | 7.1% | 2.0% | 5.4% | 6.7% | 6.7% | 9.5% | 6.7% |
| Fuel | 47.5% | 80.1% | 48.3% | 29.1% | 12.2% | (2.8)% | 23.4% | 26.9% | 24.2% | 16.2% | 8.6% | 20.3% |
| Total Retail (incl. fuel) | (0.1%) | 2.2% | 2.5% | 7.2% | 6.2% | 5.4% | 5.2% | 8.9% | 9.6% | 8.0% | 9.3% | 8.8% |
Outlook
Our Food First strategy has given us the financial flexibility to make the right decisions for customers, for colleagues, for communities and ultimately for our shareholders. This has delivered strong results and we’re starting the new financial year with great momentum. We’re determined to build on this stronger base and sustain this momentum, retaining the flexibility to make the right choices given a still uncertain outlook for consumer spending. Therefore, at this early stage of the year we expect underlying profit before tax will be between £640 million and £700 million in FY2023/24. We continue to expect to generate at least £500 million of Retail free cash flow.
Dividend
The Board has proposed a final dividend of 9.2 pence per share. This brings the full year dividend to 13.1 pence per share, in line with last year.
Notes
Certain statements made in this announcement are forward-looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual events or results to differ materially from any expected future events or results referred to in these forward-looking statements. They appear in a number of places throughout this announcement and include statements regarding our intentions, beliefs or current expectations and those of our officers, directors and employees concerning, amongst other things, our results of operations, financial condition, liquidity, prospects, growth, strategies and the business we operate. Unless otherwise required by applicable law, regulation or accounting standard, we do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise.
A live webcast presentation and Q&A will be held at 09:15 (BST). The webcast can be accessed at the following link: https://sainsburys-2022-23-preliminary-results-announcement.open-exchange.net/registration
A recorded copy of the webcast and Q&A call, alongside slides and a transcript of the presentation will be available at www.about.sainsburys.co.uk/investors/results-reports-and-presentations following the event.
Sainsbury’s will issue its 2023/24 First Quarter Trading Statement at 07:00 (BST) on 4 July 2023.
Strategy Review: Driven by our passion for food, together we serve and help every customer
We are two years into our three-year plan to transform Sainsbury’s, putting food back at the heart of our business and we are fundamentally stronger. Prioritising food, building on our strong brand heritage and reputation for quality, innovation and service while offering customers more consistent value has enabled us to deliver strong results.
Bolder prioritisation has allowed us to make more focused investments in our brands – Argos, Habitat, Tu, Nectar and Sainsbury’s Bank – and these have continued to support our core food business while consistently delivering for customers and shareholders in their own right. By making our brands more profitable, we have been able to continue to invest in food, offer greater value, an improved product range, better service and we find that customers who love our food will also shop with us across our brands.
Underpinning all of this is our ambitious cost savings programme, Save to Invest. While we have had to make some difficult decisions, the investments we have made through this programme are delivering strong results and putting us ahead of our competitors. Our work to build a simpler and more efficient business enables us to reinvest where it makes the biggest difference to customers.
Food First
We are making good progress to put food back at the heart of Sainsbury’s by offering better value, more new products and improved service. Our grocery volume market share performance has improved considerably1 since we launched our Food First plan and we are growing our volumes ahead of other full-choice grocers12.
Value
As the cost of living crisis continues to put pressure on millions of households, we are relentlessly focused on delivering consistent value for customers. Driven by our bold cost savings programme, we have invested over £560 million over the last two years to keep food prices low through campaigns that prioritise the products customers buy most often. Over 60 per cent of this investment has gone into fresh products such as meat, fish, poultry, fruit and vegetables and dairy. As a result, we have consistently inflated behind our key competitors13 and we are seeing less switching of customer spend to limited-choice supermarkets than our competitors14.
At the end of December we increased the number of products in Aldi Price Match by 20 per cent and our largest ever campaign matched the price on around 300 fresh products and household staples including chicken breasts, milk, eggs, nappies and cereal. Own brand ranges are performing strongly and our entry price range is the fastest growing product tier.
We recently launched Nectar Prices, offering discounts to all supermarket and online customers using the Nectar app or card and results are already exceeding our expectations. Your Nectar Prices – previously My Nectar Prices, which launched in 2021 – offers customers their own personalised discounts, generating more than 70 million unique offers a week for customers using SmartShop in supermarkets. The most active Your Nectar Prices users are saving almost £200 a year on their shopping4.
Innovation
We have exceeded our innovation target by 15 per cent and launched nearly 1,400 new products during the year. More customers are celebrating special occasions, treating themselves at home and we outperformed the market at key seasonal events5. We expanded our Taste the Difference range by 33 per cent year-on-year and Taste the Difference sales are up 16 per cent versus FY2019/20.
Our seasonal ranges are popular with customers and our second Autumn Editions range included 70 per cent more products year-on-year. Since launching Inspired to Cook last year, the range has been popular with customers as more people look for creative solutions to home cooking from scratch and our World Foods range is also performing well.
In January we launched Flourish, a new range with 70 fresh and healthy convenient products that help people eat better whilst on the move. The range is already popular and bestselling lines so far include the Pesto Chicken Sandwich and Immune Boosting smoothie.
We are also changing the way we work with suppliers to build long term partnerships that drive better results. Last year we agreed a long-term contract with Moy Park, our chicken supplier, to ensure that from March 2023 all our by Sainsbury’s fresh and frozen chicken is grown under better welfare conditions. Our investment has enabled Moy Park to have better product control and we have been able to make these improvements without increasing prices for customers.
Service
We have announced a record £225 million of investment over the last 12 months in colleague pay and benefits. In 2022 we became the first major supermarket to pay the Living Wage across the country and the first to give hourly-paid colleagues a third pay rise in one year. All Sainsbury’s and Argos retail colleagues now receive a base rate of pay of £11 per hour and colleagues in London receive £11.95 per hour, increasing pay for frontline, hourly paid colleagues by 10 per cent in the last year and 44 per cent over seven years.
Alongside competitive pay we have invested heavily in extra support for colleagues in response to increased financial pressure. Colleagues told us that free food at work was important and so we recently extended the provision of free food during shifts for a further six months. To help our colleagues have more control over their monthly budgets, we also introduced a pay advance scheme where colleagues can access their pay as they earn it and invested in more frequent deeper discounts at Argos and Sainsbury’s to help colleagues save money on their shopping.
Rewarding our colleagues is driving higher colleague engagement scores and higher customer satisfaction scores. Supermarket satisfaction is consistently performing ahead of full choice competitors15, particularly in product quality and availability and colleague availability16. Colleague engagement scores have also improved over the last two years.
Customers are increasingly returning to stores post-pandemic and more people are prioritising convenience and speed as they return to the workplace. As a result, we have grown Convenience sales to £3 billion for the first time and sales are up 10 per cent year-on-year. Convenience and On Demand sales combined are up 9 per cent versus pre-pandemic and On Demand is averaging 118,000 weekly orders in as little as 30 minutes through our Chop Chop service and partnerships with Deliveroo, Uber Eats and Just Eat.
Groceries Online sales were down 13 per cent year-on-year but were 81 per cent higher than pre-pandemic levels. Groceries Online accounts for 14 per cent of grocery sales versus 8 per cent in FY2019/20. We introduced more Christmas delivery slots to serve customers and brought forward Easter grocery slots and availability scores are up17. Online productivity has improved with items picked per hour up 6 per cent year-on-year and up 9 per cent on pre-pandemic levels.
Brands that Deliver
Our portfolio of brands – Argos, Habitat, Tu, Nectar and Sainsbury’s Bank – are now £145 million more profitable than before the pandemic6, helping to support our ambition in food. By offering a wide range of great quality, affordable General Merchandise products alongside our food range, customers can do more of their shopping in one place and as a result, more are choosing to shop with us2. Our brands are more profitable and, combined with our Save to Invest programme, are giving us greater firepower to invest in price, innovation and customer service.
Nectar is the UK’s largest coalition loyalty programme and continues to grow, providing value for customers and helping drive increased profitability through Nectar360. We recently awarded our one trillionth Nectar point, equivalent to £5 billion worth of points over the last 20 years and we now have over 11 million digital Nectar users. We launched Nectar Prices in April, offering great discounts to Nectar customers in supermarkets and online. At the same time, Your Nectar Prices gives Nectar users personalised prices. Through Nectar, we are the only supermarket to have both a broad and personalised capability. Growing Nectar participation creates richer data, further fuelling the growth of our Nectar360 business. This allows us to offer over 700 brands more relevant content and activations across a range of marketing channels. Nectar360 is on track to deliver at least £90 million of incremental profit contribution by March 2026.
Argos has consistently outperformed the General Merchandise market over the last year7 as we have built on its reputation for value and delivered better convenience and availability. Customers value the certainty and speed of Fast Track delivery and Click & Collect and towards the end of the year more sales went through Argos stores inside supermarkets than standalone Argos stores for the first time. Argos’s market-leading Click & Collect and delivery offering made an especially big difference during the postal strikes over Christmas and last summer’s hot weather, when many customers used Fast Track delivery – often under four hours – for seasonal products including paddling pools and barbecues. We have extended the breadth of range at Argos, including more premium brands, and continue to invest in Argos’s digital capabilities, with 73 per cent of sales now originating online.
The transformation of the Argos store and distribution network continues at pace, reducing cost and improving availability and service for customers. We now have 17 Local Fulfilment Centres, a network that is transforming the speed at which we can fulfil customer orders and is improving product availability and driving improved customer satisfaction18. We now have the best national same and next day delivery proposition of any UK retailer. Over the last year we have closed 45 standalone Argos stores and opened 24 Argos stores inside Sainsbury’s supermarkets and 92 in-store collection points. We now have 424 stores inside Sainsbury’s supermarkets, 285 standalone stores and Collection points inside 420 Sainsbury’s stores.
Tu is the sixth largest UK clothing brand by volume19. Full-price sales now make up 80 per cent of our Clothing sales, up 15 percentage points versus pre-pandemic and we are working with more online third-party brands including Sosandar, Little Mistress and Finery to provide a wider choice. We have migrated the Tu clothing online web platform onto the Argos platform, improving the quality of the web experience and enabling customers to use their Nectar points for purchases, further integrating our portfolio of brands and helping customers save money. This integration is also saving the business money and driving greater simplicity. Online sales are up 46 per cent versus pre-pandemic.
Habitat is performing well against a challenging General Merchandise backdrop and we have gained value market share in a number of homeware categories including bedding and decorations8. We are working with third-party designers including Sanderson Design Group to offer more choice to customers and have launched a one-off range with Kew Botanical Gardens for the summer.
Our Financial Services business is benefitting from a tighter focus on providing services for Sainsbury’s and Argos customers. Profits have recovered to pre-pandemic levels as lending activity and travel money demand have increased but the loan book remains smaller than pre-pandemic levels.
Save to Invest
Our cost saving programme, Save to Invest, provides the fuel that drives our ability to invest in the areas that make the biggest difference for customers. We have made bold and deliberate decisions over the last two years to ensure we can invest in keeping prices low for customers and colleague pay. We are on track to deliver around £1.3 billion of cost savings in the three years to FY2023/24 and have reduced our operating cost to sales ratio by 97 basis points over the last two years, despite significantly higher than anticipated operating cost inflation.
We are making structural savings by rationalising our property estate and focusing on ensuring our stores are in the right locations to deliver for customers and serve communities. In the last year, we have closed eight convenience stores and three supermarkets. We have also opened 13 new convenience stores including one Neighbourhood Hub. We made the difficult decision to close our Argos operations in Republic of Ireland, including 34 stores and the website, in addition to the ongoing programme of Argos standalone store closures and the opening of Argos stores inside Sainsbury’s supermarkets.
In February, we announced plans to close two of our warehouses and invest £90 million to improve automation at our Daventry warehouse, enabling a reduction of stock, faster delivery to customers and a simpler delivery process for suppliers. Industry-leading automation alongside improved training and development for colleagues is a key focus for future investment as we look at how we can improve our logistics network to get better and faster results for customers.
We plan to transform and simplify our logistics operations by working more effectively with the expert partners who already run significant parts of our network. We have announced plans to move to three dedicated partnerships across transport, food, general merchandise and clothing by the end of 2024, instead of multiple different contracts across the network. This will make the best use of our partners’ expertise to provide better service and availability for customers, drive innovation and facilitate the sharing of industry best practice.
We are also focused on making our supply chains more efficient and increasing productivity in order to improve performance whilst creating simpler and more streamlined end-to-end processes. We have rolled out new supply chain capabilities across our food business including changing the way we forecast demand, how we purchase and order goods and the way our suppliers plan production. This is driving better availability and reducing waste.
We are becoming a simpler, nimbler and more efficient business so that we can reinvest in what matters most to customers. We have made changes to some of our office space and the way some of our Store Support Centre teams work in order to simplify processes. More than ever, our office-based colleagues are able to work remotely or from home and we have seen a significant reduction in the number that regularly use Sainsbury’s offices across our locations in the UK. These changes were therefore a necessary step in adapting our ways of working to become more flexible, particularly following the pandemic.
Plan for Better
We know that the environmental and social challenges facing the world have never been greater and that these are issues our customers and colleagues care about too. As a UK retailer serving communities across the country with a global supply base, we have a responsibility to put environmental and social sustainability at the core of how we do business to protect our planet and our people and ensure we can continue to deliver for our customers now and in the future.
Better for the planet
We recognise the importance of investing in environmental sustainability to help reduce our impact on the planet and ensure the long-term success of our business. This is why we are continuing to take bold and decisive actions to meet our accelerated target to become Net Zero in our own operations by 2035.
As part of the WWF’s Retailer Commitment for Nature, we (along with the other signatories) have increased our ambition to reduce Scope 3 emissions by 50 per cent by 2030 and net zero Scope 3 emissions by 2050. We have submitted this updated target to the SBTi (Science Based Targets initiative) for approval by the end of 2023.
We have reduced our Scope 1 and 2 absolute greenhouse gas (GHG) emissions within our operations to 461,692 tCO2e, a reduction of 38.2 per cent year-on-year and 51.4 per cent from our 2018/19 baseline. We were proud that our environmental transparency was again recognised by CDP, an environmental impact disclosure system. We were awarded an A rating for climate change for the ninth consecutive year, the only UK food retailer to reach this standard. We were also recognised by CDP as a Supplier Engagement Leader for our work in engaging with our suppliers to tackle climate change.
This year we finalised the rollout of LED lighting to 100 per cent of our entire estate, helping to reduce our lighting energy consumption by an average of 70 per cent. From December 2023, 40 per cent of our electricity consumption will originate from New to Planet sources.
We have committed to reducing our own-brand plastic packaging by 50 per cent by 2025, so far achieving absolute reduction in plastic packaging of 17.5 per cent from our baseline9. We have introduced initiatives such as quadruple strength fruit squash, double length toilet rolls and removing single-use plastic lids and were the first UK retailer to vacuum-pack all beef mince, one of our highest volume products. This uses at least 55 per cent less plastic and saves over 450 tonnes of plastic annually. We also recently removed single-use plastic trays from our by Sainsbury’s whole chicken range, saving 140 tonnes of plastic a year.
We are supporting our communities to help reduce food waste at home to decrease carbon emissions and help households save money. Since the launch of our partnership with Neighbourly in 2021, we have donated over 10 million meals to local partners who redistribute food to those who need it most. This is equivalent to a £19 million donation to charities and community groups and has prevented over 4,500 tonnes of food going to waste.
Better for Everyone
We are passionate about making a positive impact on the lives of millions of people by making the right choices for our customers, colleagues and communities.
Being an inclusive business with diverse representation at all levels is important to us. We came third in the latest FTSE Women Leaders Review, with 50.7 per cent senior women across our combined executive committee and direct reports. Only 23 FTSE 100 companies have met or exceeded the 40 per cent target. We also featured in The Times’s Top 50 Employers for Women 2022: Taking Action on Gender Equality. Whilst we are proud of the progress we have made, we still have more to do and are committed to driving positive, sustainable change.
As part of our mission to be a truly inclusive retailer, last summer we launched ‘Thrive with Sainsbury’s’, a free programme that invested £1 million to support Black founder-led start-up businesses transition to supermarket shelves. In partnership with Foundervine and Mission Ventures, the programme seeks to combat the barriers Black and ethnic minority start-up businesses face by offering one-to-one training, support with business branding and product improvements. So far, three brands – Mirror Margarita, Riddles Ice Tea and RAISE snacks – will be stocked in supermarkets later this year.
In response to the rising cost of living and as part of our commitment to Helping everyone eat better, we launched our Nourish the Nation community programme to provide food and urgent support for those most in need. Working with our longstanding charity partners Comic Relief, FareShare and other key redistribution partners, we are providing funding to initiatives designed to tackle food insecurity and ensure communities have access to balanced, nutritional and sustainable food sources. Through our Nourish the Nation programme we have raised £7.2 million to support Comic Relief and our food redistribution partners.
Better for You
Our ambition is to provide every customer with accessible information, affordable products and incentives to help them make better choices for themselves and for the planet. In 2022, we announced our revised health target based on changes to our nutrient criteria following updated government reformulation targets and expert advice, to increase our Healthy and Better for You sales tonnage to 85 per cent of total sales by FY2025/26. At least 70 per cent of the products in Aldi Price Match are also Healthy or Better for You choices.
We launched The Great Fruit & Veg Challenge for the third year to reward shoppers with extra Nectar points for purchasing fruit and vegetables between July and September. Over 585,000 customers signed up to take part and bought 88 million portions of fruit and vegetables during the challenge.
1 Nielsen Panel volume market share FY2017/18 – FY2022/23. Total FMCG (excluding Kiosk & Tobacco), Market Universe: Total Outlets
2 Nielsen Panel data, Proportion of Sainsbury’s shoppers within the total market, 52 weeks to P13, Total market= Total Outlets, FMCG excluding Kiosk & Tobacco
3 Value Reality. 1,610bps improvement vs Aldi – March 2023 vs November 2020; Edge by Ascential, internal modelling
4 Average annual saving across our top 30,000 most active Your Nectar Price users
5 Nielsen EPOS data – JS volume growth YoY% difference to Total Market growth YoY% for key events week growth versus last year events week
6 Combined operating profit of Sainsbury’s Bank, Argos (inc. Habitat) and Nectar FY2019/20 to FY2022/23
7 GfK tracked market share 12 months to March 2023
8 Global Data, Retail % of Value, Homewares, full-year to March 2023
9 Baseline reflects 2018 CY for Food + 2020 CY for GM
10 Refer to alternative performance measures for definitions and reconciliation to statutory measures
11 Special dividend is included against FY2019/20 to aid comparability
12 Nielsen Panel volume growth Yo3Y. Total FMCG (excluding Kiosk & Tobacco), 52 weeks to March 2023. Market Universe: Total Outlets
13 Nielsen panel data. Top 100 SKUs by retailer. Average Selling Price YoY growth. 52 weeks to 4 March 2023
14 Nielsen panel data. Net volume switching £m to Aldi + Lidl as % of each retailer’s volume. 52 weeks to 4 March 2023
15 Competitor benchmarking survey. Overall Supermarket customer satisfaction % score. January 2022 to March 2023
16 Competitor benchmarking survey. Q4 22/23 supermarket CSAT scores 12 weeks to 4 March 2023
17 Competitor benchmarking survey. Q4 22/23 Groceries Online CSAT scores 12 weeks to 4 March 2023. Availability = Availability of Items Offered
18 Customer Satisfaction – Argos, % score FY2022/23 average vs FY2021/22 average
19 Kantar Retail Share Total Clothing, Footwear & Accessories – % sales volume. 24 weeks ending 5 Feb 2023
