Sales surge at revamped Safeway
SUPERMARKET chain Safeway has posted a 9% jump in first-half profits and said shoppers are continuing to respond to its new-look stores.
It has refurbished dozens of its supermarkets as part of chief executive Carlos Criado-Perez's strategy to revive the grocer's fortunes. Total sales in the six months to October 13 surged 6% to £5.02bn as it gained more than 500,000 new customers.
Figures out last month showed like-for-like growth, which excludes sales at new stores, jumped 5.7% in the first half. The sales lift took pre-tax profits for the period to £181m, compared with £166.1m a year ago.
Safeway has so far reformatted 73 of its stores, extending and improving the group's fresh food areas and introducing a range of new counters. The group said 52 stores refitted in the south-east of England were now delivering double-digit sales growth.
Chairman David Webster said the results showed the progress that had been made by the group. While he refused to comment on current trading, he added: 'We have never been better prepared for Christmas'.
Webster said he believed the sector as a whole would do well over the festive season despite the heightened economic uncertainty. 'There is no reason to believe the sector and no less Safeway should not have a good Christmas. Far fewer people are travelling abroad for Christmas so more money will be spent in Britain.'
Today's figures come two years after Mr Criado-Perez, previously with US retail giant Wal-Mart, took over the chief executive role at Safeway. He immediately launched a series of weekly, deep cut price promotions to encourage shoppers back to the chain.
The reformatting programme is the second phase of his recovery plan and it will take three years to cover Safeway's 480 stores.
Webster said sales per square foot across the group were now £17.18, 12% up over the past two years. While solid, he said the group still had some way to go to challenge the likes of market leader Tesco. He added: '[The sales figure] £17.18 is way behind the leaders in our sector so I think we have a lot of headroom and opportunity to close that gap.'
