Sainsbury's Finals

[idpickering]

Full year profit ahead of consensus; accelerating investment in stores and digital

· Underlying profits up 7.8 per cent; net debt £222 million lower, ahead of target; dividend up 7.8 per cent

· Accelerating investment in store estate and technology while reducing net debt and maintaining our dividend policy

· Investing to improve more than 400 supermarkets this year

· New target to reduce net debt by at least £600 million over the next three years

And later; · In line with our policy of paying a dividend that is covered 2.0 times by underlying earnings, we propose to pay a final dividend of 7.9 pence per share, bringing our full year dividend to 11.0 pence per share, an increase of 7.8 per cent

Dividends

The Board has recommended a final dividend of 7.9 pence per share (2017/18: 7.1 pence). This will be paid on 12 July 2019 to shareholders on the Register of Members at the close of business on 7 June 2019. In line with the Group's policy to keep the dividend covered two times by underlying earnings, this will result in an increased full-year dividend of 11.0 pence (2017/18: 10.2 pence).

https://www.investegate.co.uk/sainsbury ... 00066529X/

[Arborbridge]

Thanks for posting here, Ian. Nice increase and sensible cover policy. Supermarkets are underpressure and know one can tell what the outcome will be. I don't have any inclination to sell at present, despite also having MRW and TESCO - both with problems but also virtues.
Regarding the conversation yesterday about sector balance, my retail is now 5.24% so that's just a little over "too much" as I have 21 sectors. (That's going by HYPTUSS without any attempt to finesse the results)


Arb.

[idpickering]

Thanks for posting here, Ian. Nice increase and sensible cover policy. Supermarkets are underpressure and know one can tell what the outcome will be. I don't have any inclination to sell at present, despite also having MRW and TESCO - both with problems but also virtues.
Regarding the conversation yesterday about sector balance, my retail is now 5.24% so that's just a little over "too much" as I have 21 sectors. (That's going by HYPTUSS without any attempt to finesse the results)


Arb.

You’re welcome Arb. There is a temptation to jump back into the shares, for the sake of diversification if nothing else. I’m going to try to hold firm and resist that temptation.

Ian.

[Arborbridge]

Thanks for posting here, Ian. Nice increase and sensible cover policy. Supermarkets are underpressure and know one can tell what the outcome will be. I don't have any inclination to sell at present, despite also having MRW and TESCO - both with problems but also virtues.
Regarding the conversation yesterday about sector balance, my retail is now 5.24% so that's just a little over "too much" as I have 21 sectors. (That's going by HYPTUSS without any attempt to finesse the results)


Arb.

You’re welcome Arb. There is a temptation to jump back into the shares, for the sake of diversification if nothing else. I’m going to try to hold firm and resist that temptation.

Ian.

You are probably right in doing so: at present SBRY wouldn't qualify as a choice simply due to not having a five year history of rising or stable dividends, so there's no real reason to jump back in. There are better choices at the moment, as you know. But I'm cheered that my SBRY dividend will have grown this year even though it's below the peak by some way. HYP keeps trundling on despite these ups and downs.

All the best.

[Julian]

... Nice increase and sensible cover policy. Supermarkets are underpressure and know one can tell what the outcome will be. ...

Thanks too Ian for posting and I agree with you Arb. With all the concerns swirling around about the traditional big-name supermarkets and specifically for SBRY the Asda merger getting rejected I was very pleasantly surprised by these results. The net debt reduction this year with a stated specific intention to reduce debt further in future years are also worth mention along with the cover policy.

It seems to me that SBRY management are doing a pretty good job in a difficult environment. There are shares such as SSE and Centrica in my portfolio that concern me so it's rather nice to see SBRY not joining them (yet?) on my "worried about" list. For now I'm happy to carry on holding.

- Julian

[idpickering]

Thanks too Ian for posting and I agree with you Arb. With all the concerns swirling around about the traditional big-name supermarkets and specifically for SBRY the Asda merger getting rejected I was very pleasantly surprised by these results. The net debt reduction this year with a stated specific intention to reduce debt further in future years are also worth mention along with the cover policy.

It seems to me that SBRY management are doing a pretty good job in a difficult environment. There are shares such as SSE and Centrica in my portfolio that concern me so it's rather nice to see SBRY not joining them (yet?) on my "worried about" list. For now I'm happy to carry on holding.

- Julian

You're welcome Julian. For me, SBRY are the best in the supermarket sector, and that higher yield was what tempted me to buy in the first place. Having said that, I don't regret selling out. It amazes me that a company boss can cost a company £60m on a pipedream that failed to happen, and still keep his job.

Ian.

[IanTHughes]

You're welcome Julian. For me, SBRY are the best in the supermarket sector, and that higher yield was what tempted me to buy in the first place. Having said that, I don't regret selling out. It amazes me that a company boss can cost a company £60m on a pipedream that failed to happen, and still keep his job.

One cannot be sure of course, but I doubt very much that a company boss would go for any such deal without the full backing of the Board of Directors. They could hardly sack someone for carrying out the Board Policy


Ian

[Arborbridge]

You're welcome Julian. For me, SBRY are the best in the supermarket sector, and that higher yield was what tempted me to buy in the first place. Having said that, I don't regret selling out. It amazes me that a company boss can cost a company £60m on a pipedream that failed to happen, and still keep his job.

Ian.

I take that as a bit of uncharacteristic 20/20 rear view vision Had it worked out differently and the CMA had passed the deal, it would have been a game changer. The CEO would then be far sighted and praiseworthy. It's easy now to argue that it was "obvious" that the CMA wouldn't pass it, but it was far from so at the time, otherwise one can be sure that ASDA and SBRY would never have spent the time and effort in promoting the idea.
Even now, it's far from clear that the CMA made the correct decision - it must have been a knife-edge one.

Arb.