Our investment case

Investing in Sainsbury's

We are taking Sainsbury's to the Next Level. Combined with more than 150 years of heritage, our strategy places us firmly at the heart of Britain's relationship with food. Our strong fundamentals across logistics, technology and the way we work with suppliers, and a balance sheet which allows us to invest to remain competitive, means we have built a resilient and sustainable competitive advantage.

Drawing on these strong foundations, we have a clear plan to drive growth and cash generation, with an ambition to deliver long-term value creation and strong returns for shareholders.

Decisions defined by purpose

We are driven by a clear and compelling purpose to make good food joyful, accessible and affordable, for everyone, every day.

Our purpose is more than a guiding principle, it defines how we approach every decision so that we deliver for all our stakeholders. It is the starting point for our Next Level Sainsbury’s strategy, it informs the way that each of our brands serve customers and it underpins the way we support our communities and the environment through our Plan for Better.

We have set eight commitments that we are focused on delivering as a business. These commitments sit at the centre of our investment case: delivering profit leverage from sales growth, generating sustainable and reliable free cash flow and as a result enhancing our returns to shareholders.

The strength of our balance sheet and cash generation enable us to invest capital in targeted areas, further strengthening our capabilities, driving growth and efficiency and generating higher profits and returns.

Sainsbury’s at a glance

We're the second biggest grocer in the UK, and one of the largest general merchandise and clothing retailers. We take pride in providing great quality, affordable products to customers who are shopping with us in-store and online across the country.

Our purpose

The best performing companies in the world are driven by a clear and compelling purpose. Our purpose to make good food joyful, accessible and affordable for everyone, every day, shapes why we exist and how we deliver for our customers, colleagues, suppliers and shareholders.

Our brands

Sainsbury’s is a well-loved brand that has been serving customers for over 150 years. Together with our complementary brands, Argos, Nectar, Nectar360, Habitat, Tu, Smart Charge and Sainsbury’s Bank, we are delivering our purpose and giving customers more reasons to shop with us.

Our strategy

In February 2024, we set out our Next Level Sainsbury’s strategy – designed to build on the success of our 2020 Food First plan. Our strategy continues to put food at the heart of our business and aims to give customers more of what they come to Sainsbury's for: great value, leading quality and outstanding service. Having reset our competitive position and created a strong financial platform, we will continue to grow, invest in further strengthening the business and deliver enhanced returns to shareholders.

Our Plan for Better

Integrated into everything we do, our Plan for Better responsible business plan is critical to building long-term resilience in our business and across our value chains. We are committed to playing a leading role in creating a more resilient and sustainable UK food system.

Delivering profit leverage from sales growth

Food volume growth
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SG&A/sales reduction
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Measured reinvestment in the customer proposition
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Profit leverage from sales growth

Sustainable and reliable cash generation

Robust profitability
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Disciplined capital investment
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Strong sustained cash flows and higher return on capital

Enhanced returns to shareholders

Strong sustained cash flows
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Focused capital allocation
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Enhanced shareholder returns

Our eight commitments

Our investment case is underpinned by these eight commitments, which we are focused on delivering by March 2027. We update our progress against these commitments each year, represented by the red, amber or green ‘traffic lights’. The current ratings shown are based on our progress during the 2024/25 financial year.

Food volume growth ahead of the market

Customer satisfaction higher 2026/27 than 2023/24

Colleague engagement higher 2026/27 than 2023/24

Deliver our Plan for Better commitments

Deliver profit leverage from sales growth

£1 billion cost savings over three years to 2026/27

1.6 billion+ retail free cash flow over the three years to 2026/27

Higher return on capital employed

Performance and results

Discover more about our financial performance and progress against our key commitments and strategic outcomes in our Annual Report and latest results.

View Annual Report 2025 View results, reports and presentations

Our performance

We are focused on delivering the commitments we made as part of our Next Level Sainsbury’s strategy. These include delivering food volume growth ahead of the market, profit leverage from sales growth and £1 billion of cost savings in the three years to March 2027.

Our balance sheet

The strength of our balance sheet and cash generation are key strategic assets. They allow us to invest capital to remain competitive, drive growth and efficiency and build competitive advantage while also delivering strong returns to shareholders.

Capital allocation framework

Investing to support and accelerate our strategy, while maintaining a solid investment grade balance sheet and delivering strong returns to shareholders.

Shareholder returns

For financial year 2025/26, we have committed to:

A progressive dividend policy
A share buyback of at least £200 million
The return of bank disposal proceeds of £250 million via special dividend in H2
Distributable bank proceeds in excess of £250 million being used to enhance the share buyback above the core £200 million base

Find out more about our share buyback

Get in touch

If you have questions about our business and investment case, or would like to arrange a meeting with us to find out more, please email the Investor Relations team.

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