Retailer Sainsbury’s has warned of a £500million coronavirus hit to the current year’s profits as it said social distancing measures together with falls in clothing and fuel sales would offset surging grocery trade.
The supermarket chain said the impact of Covid-19 is expected to leave underlying pre-tax profits broadly flat for the year to March 2021, despite £450m in business rates relief.
It has scrapped its final shareholder dividend and said decisions on further payouts would be deferred until later in the financial year – a decision which comes after rival Tesco was criticised for paying out £635m.
Sainsbury’s full-year results showed a two per cent fall in underlying pre-tax profits to £586m for the year to March 7.
Pre-tax profits rose to £255m from £202m the previous year, on a statutory basis.
Grocery sales soared by 12 per cent in the seven weeks to April 25, compared with a two per cent rise in the final quarter of its previous financial year.
Sainsbury’s boss Mike Coupe is leaving at the end of May.
