J Sainsbury has announced “strong” first half results and a property deal just a week after a private equity bid for the retailer collapsed. It has reported a 27% increase in underlying pre-tax profits to £240m.
The supermarket chain has also revealed that total retail sales are up by 4.7% to nearly £10m over the period. Like-for-like sales, excluding fuel, are up by 4%. It says that growth in sales of organic food helped, with the chain now stocking around 1000 organic products.
Commenting on the results, chief executive Justin King (pictured) says: “Everyone at Sainsbury’s has been focused on serving customers better despite the potential distraction of corporate activity. These results are a credit to the hard work and commitment of our 150,000 colleagues.”
It has also announced a joint venture with property group Land Securities involves three stores worth a value of £113.4 million and will run for seven years. Sainbury says it is operating an “active property strategy” and that the partnership may include further stores over time.
Last week, Qatar-backed Delta (Two) abandoned its bid for Sainsbury property portfolio, worth an estimated £8 billion.
Property investor Robert Tchenguiz, who has 10% share in Sainsbury’s, is understood to be planning to press the company to cash in on its property portfolio. Last year, when Tchenguiz first proposed the strategy to split the business into two divisions; retail and property, it was rejected but Tchenguiz is understood to have requested a meeting with chairman Sir Philip Hampton, to discuss the plan.