Safeway content with steady sales
Marginal like-for-like dip against strong comparatives
July 8 2003
UK supermarket chain Safeway said its like-for-like sales have been broadly stable across the first quarter, with a slight dip against strong comparatives last year being in line with expectations.
The company said first quarter profits were also flat. With potential buyers for Safeway currently the subject of an investigation by the Competition Commission, due to report next month, maintaining sales during the uncertainty surrounding the bid process is no mean feat.
Safeway has focused on maintaining staff morale, as well as customer confidence, over the six months since the bidding war began with an offer from rival Morrisons.
Rivals Tesco and Asda, both potential bidders for Safeway, have continued to successfully build market share over the same period. Safeway, along with Sainsbury’s, has had to fight to maintain sales.
In a statement coinciding with Safeway’s annual meeting, chairman David Webster said: “I am pleased to report that we have continued to deliver a resilient trading performance during the first quarter of the new financial year.”
In May, Safeway reported 0.8 per cent like-for-like sales growth for the first six weeks of the quarter, adjusted for Easter, “but we also indicated that we expected sales to slow in the second six weeks against the strong growth in the comparative period last year, which benefited from the launch of four of our second-generation megastores and the World Cup and Jubilee events.
“Our sales performance during the remainder of the first quarter has very much met those expectations.” Like-for-like sales for the twelve-week period reduced by 0.6 per cent or 0.3 per cent when adjusted for Easter timing, which Webster said was “broadly stable and on budget.” Total sales grew by 1.1 per cent.
Chief executive Carlos Criado-Perez, who will depart once the business is sold, said: “We have made a solid start to the year, despite the distractions of the corporate situation, and we are achieving our objective of maintaining a broadly stable trading performance in Safeway.
“Over the last four years it has been the creativity and hard work of our people that has driven our success. Today it is their loyalty and commitment which has been key to achieving our results. To each and every one of my colleagues in our stores, depots and head office goes my warmest recognition.
“Given the good progress we are continuing to make with our new format stores, the effectiveness of our hi-lo promotional programme and the pace of improvement in our ranges, all of which are helping us to serve our 10 million shoppers better every day, I remain confident that we are ready to meet the challenges which lie ahead.”
