London - UK supermarket chain J Sainsbury Plc showed it’s
coping with a Brexit-fueled squeeze on industry profitability as it reported
annual profit that met analyst estimates.
Underlying pretax profit fell 1 percent to 581 million
pounds ($750 million) in the 12 months ended March 11, the London-based company
said in a statement Wednesday.
That compared with the 580 million-pound average estimate of
nine analysts surveyed by Bloomberg. General-merchandise chain Argos
contributed 77 million pounds to that figure.
“Our food business remains resilient in a challenging market
and we continue to innovate in quality and to invest in price,” Chief Executive
Officer Mike Coupe said in the statement.
Read also: Sainsbury chief to stay on
Sainsbury’s profit will reassure investors that the company
is holding its own in a market where sterling’s drop after last year’s
vote to leave the European Union has put a squeeze on profitability.
UK grocers are seeking to balance passing on some of their
increased import costs in the form of higher prices without sending shoppers
flocking to discounters Aldi and Lidl.
The shares fell 2 percent to 273.8 pence in early London
trading. Sainsbury said the impact of the pressure on its costs remains
uncertain. The company proposed a final dividend of 6.6 pence, missing Bloomberg’s
forecast of 7.3 pence a share.
BLOOMBERG