In April the Sainsbury's Board chose, due to limited visibility at the time on the potential impact of COVID-19 on the business, to defer dividend payment decisions and did not pay a final dividend for the 2019/20 financial year. In the light of improved visibility, strong trading and a strong balance sheet position, the Board has chosen to pay a special dividend in lieu of a final dividend for the 2019/20 financial year. The dividend of 7.3p is aligned to policy of 1.9x full year dividend cover by underlying earnings. This will be paid on 18 December 2020 to shareholders on the Register of Members at the close of business on 13 November 2020.
The Board has approved an interim dividend of 3.2p, in line of paying 30 per cent of prior full year dividend. This will also be paid on 18 December 2020 to shareholders on the Register of Members at the close of business on 13 November 2020.
Other financial highlights include:
Total Retail sales up 7.1 per cent (excluding fuel) with like-for-like sales up 6.9 per cent. Grocery sales up 8.2 per cent and General Merchandise sales up 7.4 per cent
Digital sales up 117 per cent to £5.8 billion, nearly 40 per cent of total sales. Groceries Online sales up 102 per cent
Statutory Group sales (excluding VAT) down 1.1 per cent, with fuel sales down 44.6 per cent
Loss before tax £(137) million, reflecting £438 million of one-off costs associated with Argos store closures and other strategic and market changes
Underlying profit before tax £301 million
Retail costs of approximately £290 million to protect customers and colleagues from COVID-19, partially offset by £230 million business rates relief
Free cash flow £943 million
Non-lease net debt down by £912 million to £267 million
Special dividend of 7.3p to be paid in lieu of final dividend for the 2019/20 financial year, aligned to policy of 1.9x full year dividend cover by underlying earnings
Full year underlying profit before tax now expected to be at least five per cent higher than last year, reflecting stronger than expected sales, particularly at Argos