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Articles: Sainsbury warns on profits as chairman goes

Posted by admin on Thursday, July 01, 2004 - 12:33 AM

Sainsbury Chairman Peter Davis will leave a year ahead of time, Britain's third-biggest supermarket chain says after issuing its second profit warning in fourth months.
Sainsbury SBRY.L , losing market share to bigger rivals Tesco and Asda, said on Thursday Davis would be succeeded on July 19 by Philip Hampton, a former finance director at Lloyds TSB and BT Group>. The firm also said profits in the current financial year would be hit by attempts to improve on-shelf availability and to trade out of an over-stocked position in non-food goods. "Underlying profit before tax for 2004/05 will be significantly below consensus market forecasts with the majority of the impact expected in the first half," it said in a statement, adding analysts consensus forecast for underlying profits had been 505 million pounds. Sainsbury shares were marked down nearly 10 percent at 260 pence in pre-market trade, dealers said. Davis's departure follows criticism from investors about plans to give him a bonus worth over 2.0 million pounds. Davis had moved up to chairman in November to make way for former Marks & Spencer executive Justin King as chief executive. As King's predecessor, Davis spent three years pouring 3.0 billion pounds into modernising stores, systems and depots, but his recovery plan failed to lift sales.

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