Sainsbury's lifts outlook on strong Xmas sales

Sainsbury's raised its profit outlook Wednesday (January 12), after a strong Christmas season.

The UK supermarket group said holiday sales beat forecasts, even if they didn't match the stellar performance a year earlier.

Back then, strict lockdowns drove a surge in spending on food and drink.

Now Sainsbury's is raising its profit forecast for the coming year by 9% to at least 720 million pounds - or about $981 million.

Its shares were up over 2.5% by early afternoon.

Shares in bigger rival Tesco also gained, on hopes that it too is set to upgrade its outlook when it reports on Thursday (January 13).

Sainsbury's has been battling rising inflation in its operating costs.

But it says that was more than offset by cost cutting measures and stronger-than-expected sales of groceries.

Its Argos general merchandise unit benefited as cost savings lifted margins.

Lower-than-expected bad debts and a recovery in lending also helped Sainsbury's financial services unit.

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