Sainsbury's, the UK supermarket chain, announced on Wednesday that it had made its first ever loss. For the six months to 9 October, it reported a pre-tax loss of £39m ($72m), compared with a profit of £323m the previous year.
Excluding £168m of exceptional items, such as the clearance of surplus merchandise, Sainsbury's made a pre-tax profit of £131m for the first half of its financial year. The company had made a profits warning earlier in the year. The company's shares actually rose slightly on the news. This is due to the absence of any surprises - shareholders were expecting results in line with these.
Sainsbury's chief executive Justin King admitted the firm had been failing to properly stock its shelves after struggling with faulty distribution systems. This problem however is only one of a series of problems that has plagued Sainsbury's in recent years. Once the UK's largest supermarket chain, Sainsbury's has been overtaken by both Tesco and Asda in recent years.
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Sainsbury's posts first ever loss