The British government should move at pace to end a duty exemption which allows shipments worth up to £135 to be imported from overseas without incurring customs duty, the boss of supermarket Sainsbury's said last week.
Britain's retail industry has expressed concern about the risk of lower quality goods being rerouted from the United States to Europe as a result of US president Donald Trump's tariffs and wants the government to review the so-called "de minimis" rules.
Sainsbury's CEO Simon Roberts on Thursday called on the government to act as soon as possible, echoing comments from retailers including electricals chain Currys.
"Everyone should pay their tax ... So if there's a loophole here which means that's not happening then that needs to be closed so it's a level playing field for everybody," he told reporters after Sainsbury's, which owns the Argos general merchandise business, reported annual results.
About a quarter of Sainsbury's sales are from non-food products versus about 7 per cent for rival Tesco, making it more vulnerable to any knock-on effects on global shipping from the hike in US tariffs.
Roberts said Sainsbury's was watching the tariff developments closely but stressed the group was "pretty well versed in navigating these kind of challenges", having gone through the COVID pandemic, fallout from the Ukraine/Russia war and the Red Sea crisis.
The supermarket giant reported overall sales (excluding fuel) of £26.6 billion for the 52 weeks ended March 1, 2025, marking a 4.2 per cent increase year-on-year. This growth was particularly strong in the final quarter, with Sainsbury's Q4 sales rising by 4.1 per cent.
This positive trend was mirrored in Argos, which saw a 1.9 per cent increase in Q4 sales, indicating a potential turnaround in its online traffic trend. However, Argos's full-year sales experienced a 2.7 per cent dip, while fuel sales also saw a decrease of 8.9 per cent.
Despite the challenges faced by Argos and fuel, Sainsbury's retail underlying operating profit saw a healthy 7.2 per cent surge to £1.04bn. The company highlighted double-digit profit growth within its Sainsbury's supermarkets as a key driver, which partially offset the lower profits from Argos.
Statutory profit after tax witnessed a substantial 77 per cent increase, reaching £242 million.
“We’ve transformed our business over the past four years. We have created a winning combination of value, quality and service that customers love, investing £1 billion in lowering our prices. More people are choosing Sainsbury’s for their main grocery shop as a result, delivering our highest market share gains in more than a decade,” Roberts said.
The retailer anticipates continued growth in grocery volumes, outpacing the wider market, in the 2025-26 fiscal year and has already observed positive trading momentum across all its brands at the start of the year.
Looking ahead, Sainsbury's projects a retail underlying operating profit of around £1 billion and retail free cash flow exceeding £500 million. Profit delivery is expected to be bolstered by the increasing contribution from its Nectar loyalty program and sustained cost-saving initiatives.
