J Sainsbury FY pre-tax profit down 18.7%Staff Writer | May 2, 2018
J Sainsbury, the parent company of British supermarket chain Sainsbury's Supermarkets Ltd, reported that its profit before tax for the 52 weeks to 10 March 2018 declined 18.7 percent to 409 million pounds from 503 million pounds last year as a result of a charge of 180 million pounds recognized outside underlying results.
J Sainsbury Profit for the financial year was 309 million pounds
Underlying basic earnings per share decreased 6.4 per cent to 20.4 pence, reflecting the full-year impact of the additional shares issued as a result of the HRG acquisition and a slightly higher underlying tax rate.
Basic earnings per share decreased to 13.3 pence from 17.5 pence last year, more than the fall in underlying earnings per share, mainly as a result of the 180 million pounds charge for items excluded from underlying results.
However, revenue for the year grew to 28.46 billion pounds from 26.22 billion pounds last year.
Underlying group sales, including VAT and fuel, increased by 9.0 per cent, mainly as a result of the impact of consolidating a full year of Argos.
Including Argos in the base, retail sales (including VAT, excluding fuel) increased by 1.6 per cent, due to an improved like-for-like performance. Fuel sales grew 2.6 per cent, largely driven by retail price inflation.
Sainsbury noted that cost savings of 185 million pounds were delivered during the year resulting in a cumulative three-year total of 540 million pounds, 40 million pounds ahead of the target the company set in 2014/15.
The company added that it has developed plans to deliver a further three-year cost saving target of 500 million pounds by 2020/21 as it continues to simplify the business and expects to achieve savings of around 200 million pounds in 2018/19.
The Board has recommended a final dividend of 7.1 pence per share, compared to 6.6 pence per share last year. This will be paid on 13 July 2018 to shareholders on the Register of Members at the close of business on 8 June 2018, subject to approval by shareholders at the AGM.
In line with the Group's policy to keep the dividend covered two times by underlying earnings, this will result in an unchanged full-year dividend of 10.2 pence per share.
Looking ahead, Sainsbury said that its outlook for 2018/19 underlying profit before tax is in line with current market consensus of 629 million pounds. The company recently announced a proposed combination with Asda. ■