Shares in supermarket chain Sainsbury’s fell back after it cut its full-year sales forecast despite enjoying record-breaking festive sales.
In an update to the markets, the retailer said the seven days up to Christmas had been its busiest ever trading week, with more than 28 million transactions completed.
The buoyant period helped the chain maintain its record of successive growth into a 36th quarter, after posting a 0.2% rise in like-for-like sales in the 14 weeks to January 4.
Chief executive Justin King praised the firm’s festive performance.
“This quarter has been characterised by a very tough sales environment throughout October and November, with customers saving up in order to treat their families over the Christmas period,” Mr King said.
He said the like-for-like sales rise excluding fuel of 0.2%, coupled with a strong contribution from new space, led to their “best Christmas ever”.
Despite the upbeat trading figures, stock in Sainsbury’s fell 2.4% or 8.9p to 360p after the retailer moved to cut its like-for-like sales forecast for the full year from between 1% and 1.5% to “just under 1%”.
The company which has been moving to bolster its convenience store offering in recent months and saw a 10% increase in online sales in the quarter cited continuing uncertainty over household incomes as the reason for its caution.
Analysts at Barclays said 0.7%-0.8% growth was now more likely, and also shaved their forecast for annual pre-tax profits.
Mr King said: “As with last year, we expect customers to spend cautiously in the few months following Christmas, in an attempt to rebalance the household finances.
“The general economic backdrop remains uncertain for many families.”
Embattled Co-operative Group also provided an update, reporting a rise in festive sales across its supermarket arm thanks to a robust performance from its smaller convenience stores.
The Co-op which has a strong presence in the east of Scotland sought to put the woes at its banking business behind it as it hailed “strong” trading in the 2,800-strong food chain, with like-for-like sales up 1% in the 13 weeks to January 4.
A 3.2% hike from its 2,000 smaller convenience stores drove the rise, as shoppers sought to buy more frequently and locally over the Christmas season. Group chief executive Euan Sutherland said the results were testament to the strength of the Co-op brand.
He said: “These strong sales figures from our food business are very encouraging, reflecting the loyalty of our customers and the hard work of all our colleagues in the group while the Co-operative Bank was in the headlines.
“The recapitalisation of the bank at the end of last year represented an important milestone, and now we can see that the foundations of the wider group, through its trading business, remain strong.
“There is still a huge amount to be done, and I remain convinced of the great potential to be realised for customers and members.”
Premium supermarket group Waitrose meanwhile toasted a record Christmas after achieving a 4.1% like-for-like sales hike at its stores for the 12 days ending December 31.
December 23 was a record day, when check-outs rung up £51 million in takings.
Like-for-like sales for the five weeks to Christmas Eve were up 3.1% on the year.