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4 November 2021 J Sainsbury plc Interim Results for the 28 weeks ended 18 September 2021 Strong performance with market share gains as we put food back at the heart of Sainsbury's Financial Highlights • • • Grocery sales grew by 0.8 per cent versus H1 20/21 and 9.1 per cent versus H1 19/20 and we gained market share , driven by improved value , innovation and service , supported by customers continuing to eat at home more General Merchandise sales reduced by 5.8 per cent versus H1 20/21 , as expected against strong lockdown and seasonal sales comparatives , but grew 1.1 per cent versus H1 19/20 Strong digital sales of £ 5.8 billion , consistent with H1 20/21 at 39 per cent of retail sales Statutory Group sales ( excluding VAT ) up 5.3 per cent , with fuel sales up 62.7 per cent Underlying profit before tax of £ 371 million , up 23 per cent versus H1 20/211 . Up 56 per cent versus H1 19/20 , reflecting higher grocery sales and effective cost reduction programmes , particularly at Argos Statutory profit before tax of £ 541 million reflects significantly lower restructuring and impairment costs versus H1 20/21 and £ 181 million of exceptional income from settling legal disputes Strong retail free cash flow of £ 554 million¹ . On track to meet free cash flow and net debt reduction targets Interim dividend of 3.2 pence We continue to expect to report underlying profit before tax of at least £ 660 million in the financial year to March 2022 Strategic highlights • • о Food First : Good progress against the plan we set out last November to put food back at the heart of Sainsbury's Value : Significantly improved versus competitors , driving sales , market share and switching gains Innovation : On track to triple the number of new products this year ; new lines very popular with customers ○ O Customer Service : Maintained strong customer satisfaction scores with supermarket scores ahead of key competitors² . Investing to improve our Groceries Online customer offer and improve productivity , attracting more customers and gaining market share ; sales are up 13 per cent this year and 128 per cent over the past two years Brands that Deliver : Nectar , Argos , Habitat , Tu and Sainsbury's Bank are clearly focused on supporting the core food business and delivering for customers and shareholders ○ о Continuing to transform Argos , significantly reducing the cost base and improving the customer offer Relaunched the iconic Habitat brand and introduced Habitat Kids Tu clothing sales grew strongly , helped by increased full price sales . Clothing online sales remain strong Grown digital Nectar to over 8 million customers and launched My Nectar Prices , currently offering customers approximately 95 million personalised discounts and promotions every week Financial Services returned to profit ; strong capital position Save to invest : Three - year structural cost reduction programme on track to reduce retail operating costs to sales ratio of at least 200 basis points Plan for Better : Ahead of our trajectory to become net zero in our own operations no later than 2040 and accelerated this commitment to 2035 ahead of the COP26 summit in Glasgow , where we are a Principal Partner H1 Financial summary 2021/22 2020/21 2019/20 % change v 20/21 % change v 19/20 Statutory performance Group revenue ( excl . VAT , inc . fuel ) £ 15,724m Profit / ( Loss ) before tax Profit ( Loss ) after tax £ 541m £ 389m £ 14,934m £ ( 137 ) m £ ( 179 ) m £ 15,097m 5.3 % 4.2 % £ 9m N / A N / A £ ( 38 ) m N / A N / A Basic earnings / ( loss ) per share 17.3p ( 8.3 ) p ( 2.2 ) p N / A N / A Business performance¹ Group sales ( inc . VAT ) £ 17,528m Retail sales ( inc . VAT , excl . fuel ) £ 14,871m £ 16,557m £ 14,836m £ 16,856m 5.9 % 4.0 % £ 13,857m 0.2 % 7.3 % Digital sales £ 5.8bn Underlying profit before tax £ 371m £ 5.8bn £ 301m £ 2.7bn 0 % 108 % £ 238m 23 % 56 % Underlying basic earnings per share 12.2p 10.1p 7.9p 21 % 54 % Interim dividend per share 3.2p 3.2p 3.3p 0 % ( 3.0 ) % Net debt ( including lease liabilities ) £ ( 6,345 ) m £ ( 6,168 ) m £ ( 6,778 ) m Up £ 177m Down £ 433m Non - lease net debt Return on capital employed £ ( 27 ) m 6.3 % £ ( 267 ) m £ ( 1,008 ) m Down £ 240m Down £ 981m 7.9 % 7.1 % ( 160 ) bps ( 80 ) bps 1