Sainsbury’s has posted a 55.3% increase in profit after tax for the year to 28 February 2026, helped by reduced losses from discontinued financial services activities and reduced restructuring charges.
The UK-based supermarket chain reported a profit after tax of £393m ($529.7m) for the year.
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Group revenue, excluding VAT and including fuel, rose 2.7% from a year earlier to £33.64bn.
Sales excluding fuel increased 4.9% to £25.87bn while grocery sales were up 5.2%, supported by ongoing volume growth and gains in market share.
Argos revenue increased 0.7% to £4.12bn. Fuel sales, however, fell 8.2% to £3.55bn.
At Argos, sales growth came as volumes rose 3.7%, though this was partly offset by a 3% fall in average selling prices amid competitive pressure.
Total basic earnings per share rose 58.7% to 17.3p during the period.
In capital returns, the retailer paid £316m in dividends and carried out a £200m share buyback over the year.
After disposing of its banking operations, Sainsbury’s returned a further £300m to shareholders through a £250m special dividend and a £50m additional buyback.
It also set out plans for another £100m return alongside a £200m core buyback in 2026/2027.
The company said it remained on course with its “Next Level Sainsbury’s” strategy, which aims to deliver £1bn of cost savings over three years.
Since February 2024, it said it has achieved £680m of those savings.
Sainsbury’s said it is finalising its withdrawal from core banking, including asset disposals to NatWest Group, Allianz UK, Fexco Group and NewDay. It expects to give up its banking licence by July 2026.
Looking ahead, the retailer said it had made a “positive start” to the new financial year, with grocery volume growth ahead of the wider market, although demand in general merchandise remains weak.
Sainsbury’s CEO Simon Roberts said: “By staying relentlessly focused on the things that matter most – value, quality, availability and service – we have outperformed the market for the sixth year in a row.
“Rather than pass through the full extent of cost inflation, we invested to sustain the strength of our competitive position while also refreshing stores, improving digital experiences and increasing colleague pay by 5%.”
For 2026/2027, Sainsbury’s expects total underlying operating profit of between £975m and £1.075bn, with retail free cash flow of more than £500m.
The company also said geopolitical uncertainty, including conflict in the Middle East, could have an impact on both customers and its operations.
