Investing.com — J Sainsbury PLC (LON:) shares tumbled 5.1% Thursday after the UK grocer issued cautious profit guidance for the year ahead, despite reporting better-than-expected fourth-quarter results and full-year earnings.
The company reported adjusted earnings per share of 22.3 pence for the 52 weeks ended 28 February 2026, beating analyst estimates of 22.1 pence. Revenue reached £33.65 billion, slightly below the £33.73 billion consensus.
However, the grocer’s guidance for fiscal 2027 underlying operating profit of £975 million to £1.075 billion fell short of analyst expectations of £1.10 billion, citing uncertainty from the Middle East conflict and its impact on consumers.
Sainsbury’s delivered like-for-like sales growth of 3.1% in the fourth quarter, excluding fuel, matching analyst forecasts. Grocery sales rose 4.5% for the full year, while Argos sales increased 0.7%, reflecting volume growth offset by pricing pressure in a subdued general merchandise market.
Total retail sales climbed 2.8% to £33.55 billion, though underlying operating profit slipped 1.1% to £1.025 billion as significant cost inflation offset volume gains.
“More and more customers are choosing Sainsbury’s for more of their shopping, trusting us to deliver great value day in day out,” said Chief Executive Simon Roberts. “The conflict in the Middle East means customers are even more focused on the cost of living and we are absolutely committed to making sure everyone gets the best possible value when they shop with us.”
The company generated retail free cash flow of £574 million, up 8.1% YoY, supported by strong working capital management.
The board proposed a final dividend of 9.6 pence per share, bringing the full-year dividend to 13.7 pence, up 0.7% from the prior year. Sainsbury’s also announced a £300 million share buyback programme for fiscal 2027.