Sainsbury’s sales fall as King era draws to a close

The group, which trails market leader Tesco and is battling with Leeds-based Asda to be the UK’s number two supermarket, said sales at stores open over a year fell 1.1 per cent, excluding fuel, in the 12 weeks to June 7, its fiscal first quarter.

That compared to analysts’ forecasts of down 0.5-1.5 per cent and a fall of 3.1 per cent in the fourth quarter of Sainsbury’s 2013-14 year.

The fourth quarter decline followed unbroken positive sales for the best part of nine years. Mr King will be succeeded by commercial director Mike Coupe following Sainsbury’s annual shareholders’ meeting on July 9.

The firm said it was confident it would outperform its supermarket peers through the remainder of the year.

The grocer last month forecast underlying sales growth for the year similar to the 0.2 per cent achieved in 2013-14.

That is significantly better than expectations for Tesco and Bradford-based Morrisons, which have both flagged negative like-for-like sales as they cut prices.

The grocery market is growing at its slowest rate for 11 years and its so called “big four” players are all being outpaced by sales growth at German discounters Aldi and Lidl, while upmarket chains Waitrose and Marks & Spencer are also gaining share.

Last week Tesco reported its worst quarterly performance for 40 years.