Sainsbury’s King Derides ‘Unrealistic’ Comments on U.K. Economy
J Sainsbury Plc (SBRY) Chief Executive Officer Justin King took a swipe at politicians for talking up the U.K. economy, saying that consumers continue to struggle.
“It’s unrealistic to paint a picture which is not the reality that consumers are currently experiencing,” King said at a conference in London today. “Nobody should be planning their business today if they’re customer-facing on an expectation that consumers have extra money to spend.”
Chancellor of the Exchequer George Osborne said June 23 the economy was moving from rescue to recovery. His comments came three days after official figures showed that U.K. retail sales rose more than economists forecast in May as food sales increased at their fastest pace for more than two years.
“It’s the job of politicians to talk things up or talk things down,” King said, while reiterating Sainsbury’s guidance for sales growth. “If you’re in power, you talk things up.”
Consumer spending will remain subdued as households struggle with inflation outpacing wage growth, King said.
Sainsbury forecasts growth of 1 percent to 1.5 percent in same-store sales for the full financial year. The company last repeated the target when it reported quarterly sales June 12.
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