J Sainsbury PLC

PMS295  PMS021  .Special Cream

PMS295  PMS021  .Special Cream

J Sainsbury plc

Annual Review1997
and Summary Financial Statement

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J Sainsbury plc
Stamford House  Stamford Street  London SE1 9LL
http://www.sainsburys.co.uk

ES No
Client Stage
Int Stage
Date
Op

119504
Two
Two
21.05.97
ola

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
FC/BC Review
Incarnatus

ES No
Client Stage
Int Stage
Date
Op

119504
Two
Two
21.05.97
ola

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
FC/BC Review
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474 Fax 0171 387 9793

Tel 0171 387 7474 Fax 0171 387 9793

 
 
 
 
 
 
Contents

Financial Highlights 1

Chairman’s Statement 2-3

Board of Directors 4-5

Chief Executive’s Review
UK Food Retailing Businesses 6-7

Sainsbury’s Supermarkets 8-13

Savacentre 14-15

Chief Executive’s Review
Homebase and 
US Businesses 16-17

Homebase 18-21

Shaw’s  22-23

Ten Year Financial Record 
and New Store 
Openings and Extensions 24-25

Financial Review 26-29

Summary 
Financial Statement 30-33

Investor Information 34-35

Financial Calendar  36

Registered Office and Advisers

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Financial Highlights

Group Profile  J Sainsbury plc is one of the world’s leading retailers, operating
three separate store chains and a bank in the UK and one store chain in the US. Through

these operations, J Sainsbury plc serves more than 12.5 million customers a week. 

Sainsbury’s Supermarkets is the largest part of the Sainsbury Group, accounting for

89% of Group operating profit before profit sharing and exceptional costs and 75% 

of Group sales. The other UK food retailing arm is Savacentre, the country’s only specialist

hypermarket company.

Homebase, also in the UK, is our chain of home improvement stores and garden centres.

In the US Shaw’s Supermarkets, Inc. operates a chain of supermarkets in New England. 

J Sainsbury plc also has a holding of approximately 20% in Giant Food Inc., a supermarket

group which is the market leader in the Washington DC and Baltimore areas.

Founded in London in 1869, Sainsbury’s was privately owned until public flotation

in 1973. The Sainsbury family and its charitable trusts remain major shareholders and the

present Chairman, David Sainsbury, is a great-grandson of the founders.

Group Objectives To discharge the responsibility as leaders in our trade by
acting with complete integrity, by carrying out our work to the highest standards, and by

contributing to the public good and to the quality of life in the community.

To provide unrivalled value to our customers in the quality of the goods we sell, 

in the competitiveness of our prices and in the range of choice we offer.

To achieve the highest standards in efficiency of operation, convenience and

customer service in our stores, thereby creating as attractive and friendly a shopping

environment as possible.

To offer our staff outstanding opportunities in terms of personal career

development and in remuneration relative to other companies in the same market,

practising always a concern for the welfare of every individual.

To generate sufficient profit to finance continual improvement and growth of the

business whilst providing our shareholders with an excellent return on their investment.

£ million

1997

1996
52 weeks to 52 weeks to
9th March

8th March

%
Change

GROUP SALES (incl. taxes) .   .

14,312

13,499

6.0

GROUP OPERATING PROFIT
before profit sharing and 
exceptional costs

.   .   .   .   .   .

Profit Sharing .   .   .   .   .   .   .   .

Associates

.   .   .   .   .   .   .   .   .

Net Interest Payable

.   .   .   .   .

(12.8)

745

(37)

19

(76)

854

(50)

19

(59)

GROUP PROFIT
before tax, exceptional 
costs and profit/(loss) 
on sale of fixed assets

.   .   .

651

764

(14.8)

Profit/(loss) on sale of 
fixed assets

.   .   .   .   .   .   .   .

Exceptional costs

.   .   .   .   .   .

8

(4)

(50)
———————————

(48)
———————————

GROUP PROFIT BEFORE TAX .

Tax

.   .   .   .   .   .   .   .   .   .   .   .

609

(208)

712

(234)

GROUP PROFIT AFTER TAX .

———————————
401
———————————

———————————
478
———————————

EARNINGS PER SHARE .   .   .   .

22.0p

26.8p

FULLY DILUTED EARNINGS 
PER SHARE before
exceptional costs and profit 
on sale of properties

.   .   .   .   .

DIVIDEND PER SHARE
of which Final

.   .   .
.   .   .   .   .   .   .

23.1p

12.3p
8.8p

27.8p

12.1p
8.7p

(16.9)

1.7

Group Sales

£ billion

14.3

13.5

12.1

11.2

10.3

1993 1994 1995 1996 1997

Group sales increased
by 6% to £14.3 billion.

Group Profit

£ million

735

731

808

764

651

1993 1994 1995 1996 1997

Group profit before tax, exceptional costs and profit/(loss) 
on sale of fixed assets decreased by 14.8% to £651 million.

Dividend per Share
Pence

12.1

12.3

11.7

10.6

10.0

1993 1994 1995 1996 1997

Dividend per share increased 
by 1.7% to 12.3 pence.

J Sainsbury plc

1

ES No
Client Stage
Int Stage
Date
Op

119504
Four
Four
21.05.97
ola

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
IFC-01 Contents
Incarnatus

ES No
Client Stage
Int Stage
Date
Op

119504
Five
Five
22.05.97
ola

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
IFC-01 Contents
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474 Fax 0171 387 9793

Tel 0171 387 7474 Fax 0171 387 9793

Contents

Financial Highlights 1

Chairman’s Statement 2-3

Board of Directors 4-5

Chief Executive’s Review
UK Food Retailing Businesses 6-7

Sainsbury’s Supermarkets 8-13

Savacentre 14-15

Chief Executive’s Review
Homebase and 
US Businesses 16-17

Homebase 18-21

Shaw’s  22-23

Ten Year Financial Record 
and New Store 
Openings and Extensions 24-25

Financial Review 26-29

Summary 
Financial Statement 30-33

Investor Information 34-35

Financial Calendar  36

Registered Office and Advisers

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Financial Highlights

Group Profile  J Sainsbury plc is one of the world’s leading retailers, operating
three separate store chains and a bank in the UK and one store chain in the US. Through

these operations, J Sainsbury plc serves more than 12.5 million customers a week. 

Sainsbury’s Supermarkets is the largest part of the Sainsbury Group, accounting for

89% of Group operating profit before profit sharing and exceptional costs and 75% 

of Group sales. The other UK food retailing arm is Savacentre, the country’s only specialist

hypermarket company.

Homebase, also in the UK, is our chain of home improvement stores and garden centres.

In the US Shaw’s Supermarkets, Inc. operates a chain of supermarkets in New England. 

J Sainsbury plc also has a holding of approximately 20% in Giant Food Inc., a supermarket

group which is the market leader in the Washington DC and Baltimore areas.

Founded in London in 1869, Sainsbury’s was privately owned until public flotation

in 1973. The Sainsbury family and its charitable trusts remain major shareholders and the

present Chairman, David Sainsbury, is a great-grandson of the founders.

Group Objectives To discharge the responsibility as leaders in our trade by
acting with complete integrity, by carrying out our work to the highest standards, and by

contributing to the public good and to the quality of life in the community.

To provide unrivalled value to our customers in the quality of the goods we sell, 

in the competitiveness of our prices and in the range of choice we offer.

To achieve the highest standards in efficiency of operation, convenience and

customer service in our stores, thereby creating as attractive and friendly a shopping

environment as possible.

To offer our staff outstanding opportunities in terms of personal career

development and in remuneration relative to other companies in the same market,

practising always a concern for the welfare of every individual.

To generate sufficient profit to finance continual improvement and growth of the

business whilst providing our shareholders with an excellent return on their investment.

£ million

1997

1996
52 weeks to 52 weeks to
9th March

8th March

%
Change

GROUP SALES (incl. taxes) .   .

14,312

13,499

6.0

GROUP OPERATING PROFIT
before profit sharing and 
exceptional costs

.   .   .   .   .   .

Profit Sharing .   .   .   .   .   .   .   .

Associates

.   .   .   .   .   .   .   .   .

Net Interest Payable

.   .   .   .   .

(12.8)

745

(37)

19

(76)

854

(50)

19

(59)

GROUP PROFIT
before tax, exceptional 
costs and profit/(loss) 
on sale of fixed assets

.   .   .

651

764

(14.8)

Profit/(loss) on sale of 
fixed assets

.   .   .   .   .   .   .   .

Exceptional costs

.   .   .   .   .   .

8

(4)

(50)
———————————

(48)
———————————

GROUP PROFIT BEFORE TAX .

Tax

.   .   .   .   .   .   .   .   .   .   .   .

609

(208)

712

(234)

GROUP PROFIT AFTER TAX .

———————————
401
———————————

———————————
478
———————————

EARNINGS PER SHARE .   .   .   .

22.0p

26.8p

FULLY DILUTED EARNINGS 
PER SHARE before
exceptional costs and profit 
on sale of properties

.   .   .   .   .

DIVIDEND PER SHARE
of which Final

.   .   .
.   .   .   .   .   .   .

23.1p

12.3p
8.8p

27.8p

12.1p
8.7p

(16.9)

1.7

Group Sales

£ billion

14.3

13.5

12.1

11.2

10.3

1993 1994 1995 1996 1997

Group sales increased
by 6% to £14.3 billion.

Group Profit

£ million

735

731

808

764

651

1993 1994 1995 1996 1997

Group profit before tax, exceptional costs and profit/(loss) 
on sale of fixed assets decreased by 14.8% to £651 million.

Dividend per Share
Pence

12.1

12.3

11.7

10.6

10.0

1993 1994 1995 1996 1997

Dividend per share increased 
by 1.7% to 12.3 pence.

J Sainsbury plc

1

ES No
Client Stage
Int Stage
Date
Op

119504
Four
Four
21.05.97
ola

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
IFC-01 Contents
Incarnatus

ES No
Client Stage
Int Stage
Date
Op

119504
Five
Five
22.05.97
ola

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
IFC-01 Contents
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474 Fax 0171 387 9793

Tel 0171 387 7474 Fax 0171 387 9793

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Chairman’s Statement

to the outstanding sales uplifts achieved by the Texas

stores converted to the Homebase format, we have

decided to increase the speed and extent of the conversion

programme, and this has led us to provide an additional

£50 million for the costs of integration. Shaw’s continued

to make solid progress in its established markets

although its performance was adversely affected by its

rapid expansion into Connecticut.

We propose to increase the total dividend for the

year by 1.7% to 12.3p despite the reduction in Group

profit. This reflects our better trading performance and

our confidence in an improving profit trend. In the

future we expect to increase dividend per share

broadly in line with earnings per share growth.

The Year’s Results  In a year of major change,

Group Outlook and Priorities  The overall

choice and value for money. We will also ensure that

improve performance, we have set up a separate

Homebase and Shaw’s make a greater contribution to

subsidiary company, Sainsbury’s Supermarkets Ltd, to

Group profitability as performance builds following the

run the UK supermarket business. 

heavy investment programme of recent years.

As part of the restructuring of the Board, following

We believe that with these plans we can both grow

the setting up of Sainsbury’s Supermarkets Ltd, 

the Group as a high quality, international retailer, and

Colin Harvey retired from the Group Board on 

significantly improve our shareholders’ returns.

8th April 1997. He will continue as Managing Director

New Management Structure and Team  

of Savacentre until June 1999.

In March 1997 Dino Adriano took over as Chief

Sainsbury’s Bank  An important development

Executive responsible for the UK food retailing

for the Group during the year was the establishment of

businesses. He joins me and David Bremner, appointed

Sainsbury’s Bank with our joint venture partner, 

in August as Chief Executive, Homebase and US

Bank of Scotland. We provide access to an immense

Businesses, in leading the Group. Strategies and medium

customer base and our name is trusted as a financial

term goals have been established for each business in

services supplier. Bank of Scotland is a leader in direct

the Group, and these are set out by the two Chief

banking and has the added advantage that its branch

Group sales increased by 6% to £14.3 billion and Group

financial results for the past year have been disappointing,

Executives on pages 6 and 7 and pages 16 and 17.

network has little overlap with our supermarkets.

profit before tax, exceptional costs and property items

but each of our major businesses has established a clear

In July we were very pleased to welcome 

The launch of the Bank has been extremely

reduced by 14.8% to £651 million. The sales growth of

strategy and a strong base for success. We have three

Sir David Scholey CBE as a Non-Executive Director. 

successful. In the first 10 weeks we opened over 150,000

Sainsbury’s Supermarkets continued to improve during the

main priorities for the year ahead. First, to sustain the

Sir David was Chairman of the S.G.Warburg Group PLC

accounts and further new p[roducts will be introduced

year as our programme of new store openings recovered

improvement in sales growth in Sainsbury’s Supermarkets

from 1989 until 1995 and is currently Chairman of 

this summer. Start up costs led to a loss of £6.3 million

and the different parts of our trading and marketing

and translate this into stable net margins. Second, to

the Swiss Bank Corporation International Advisory

in the year but in the medium term the Bank is expected

strategy started to take effect. This improvement, however,

implement the accelerated Homebase conversion

Council, a Non-Executive Director of the Bank of

to become a significant source of profit.

was insufficient to offset the impact of the petrol price

programme effectively, while improving the performance

England and a Governor of the BBC.

Tribute to Staff  I would like to thank all our staff

war, the costs of the Reward Card and improvements

of rebadged stores awaiting full conversion. Third, to

Dr John Ashworth, who has served as a 

for their hard work during the year and for their firm

in service, and the effects of lower sales inflation.

build Shaw’s sales in Connecticut, while maintaining its

Non-Executive Director since 1993, retires from the

commitment to providing superb customer service.

Homebase and the fully converted Texas stores

steady progress in its established markets.

Board at the Annual General Meeting. I am most grateful

Theirs has been a significant contribution in a year of

continued to perform very well, but trading in the

In the medium term, we will continue to differentiate

to him for his contribution to our affairs over the past

great change. We will continue to invest substantially in

unconverted Texas stores was poor until they were

clearly the Sainsbury’s Supermarkets’ offer from that of

four years and for his wise advice.

training and staff development to enhance our ability

rebadged under the Homebase fascia in December. Due

its competitors by concentrating on outstanding quality,

In order to sharpen accountability further and

to listen to, understand and serve our customers.

2

J Sainsbury plc

J Sainsbury plc

3

David Sainsbury

ES No
Client Stage
Int Stage
Date
Op

119504
Three
Three
21.05.97
jennie

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
02-03 Chairman’s
Incarnatus

ES No
Client Stage
Int Stage
Date
Op

119504
Four
Four
21.05.97
Jennie

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
02-03 Chairman’s
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Chairman’s Statement

to the outstanding sales uplifts achieved by the Texas

stores converted to the Homebase format, we have

decided to increase the speed and extent of the conversion

programme, and this has led us to provide an additional

£50 million for the costs of integration. Shaw’s continued

to make solid progress in its established markets

although its performance was adversely affected by its

rapid expansion into Connecticut.

We propose to increase the total dividend for the

year by 1.7% to 12.3p despite the reduction in Group

profit. This reflects our better trading performance and

our confidence in an improving profit trend. In the

future we expect to increase dividend per share

broadly in line with earnings per share growth.

The Year’s Results  In a year of major change,

Group Outlook and Priorities  The overall

choice and value for money. We will also ensure that

improve performance, we have set up a separate

Homebase and Shaw’s make a greater contribution to

subsidiary company, Sainsbury’s Supermarkets Ltd, to

Group profitability as performance builds following the

run the UK supermarket business. 

heavy investment programme of recent years.

As part of the restructuring of the Board, following

We believe that with these plans we can both grow

the setting up of Sainsbury’s Supermarkets Ltd, 

the Group as a high quality, international retailer, and

Colin Harvey retired from the Group Board on 

significantly improve our shareholders’ returns.

8th April 1997. He will continue as Managing Director

New Management Structure and Team  

of Savacentre until June 1999.

In March 1997 Dino Adriano took over as Chief

Sainsbury’s Bank  An important development

Executive responsible for the UK food retailing

for the Group during the year was the establishment of

businesses. He joins me and David Bremner, appointed

Sainsbury’s Bank with our joint venture partner, 

in August as Chief Executive, Homebase and US

Bank of Scotland. We provide access to an immense

Businesses, in leading the Group. Strategies and medium

customer base and our name is trusted as a financial

term goals have been established for each business in

services supplier. Bank of Scotland is a leader in direct

the Group, and these are set out by the two Chief

banking and has the added advantage that its branch

Group sales increased by 6% to £14.3 billion and Group

financial results for the past year have been disappointing,

Executives on pages 6 and 7 and pages 16 and 17.

network has little overlap with our supermarkets.

profit before tax, exceptional costs and property items

but each of our major businesses has established a clear

In July we were very pleased to welcome 

The launch of the Bank has been extremely

reduced by 14.8% to £651 million. The sales growth of

strategy and a strong base for success. We have three

Sir David Scholey CBE as a Non-Executive Director. 

successful. In the first 10 weeks we opened over 150,000

Sainsbury’s Supermarkets continued to improve during the

main priorities for the year ahead. First, to sustain the

Sir David was Chairman of the S.G.Warburg Group PLC

accounts and further new p[roducts will be introduced

year as our programme of new store openings recovered

improvement in sales growth in Sainsbury’s Supermarkets

from 1989 until 1995 and is currently Chairman of 

this summer. Start up costs led to a loss of £6.3 million

and the different parts of our trading and marketing

and translate this into stable net margins. Second, to

the Swiss Bank Corporation International Advisory

in the year but in the medium term the Bank is expected

strategy started to take effect. This improvement, however,

implement the accelerated Homebase conversion

Council, a Non-Executive Director of the Bank of

to become a significant source of profit.

was insufficient to offset the impact of the petrol price

programme effectively, while improving the performance

England and a Governor of the BBC.

Tribute to Staff  I would like to thank all our staff

war, the costs of the Reward Card and improvements

of rebadged stores awaiting full conversion. Third, to

Dr John Ashworth, who has served as a 

for their hard work during the year and for their firm

in service, and the effects of lower sales inflation.

build Shaw’s sales in Connecticut, while maintaining its

Non-Executive Director since 1993, retires from the

commitment to providing superb customer service.

Homebase and the fully converted Texas stores

steady progress in its established markets.

Board at the Annual General Meeting. I am most grateful

Theirs has been a significant contribution in a year of

continued to perform very well, but trading in the

In the medium term, we will continue to differentiate

to him for his contribution to our affairs over the past

great change. We will continue to invest substantially in

unconverted Texas stores was poor until they were

clearly the Sainsbury’s Supermarkets’ offer from that of

four years and for his wise advice.

training and staff development to enhance our ability

rebadged under the Homebase fascia in December. Due

its competitors by concentrating on outstanding quality,

In order to sharpen accountability further and

to listen to, understand and serve our customers.

2

J Sainsbury plc

J Sainsbury plc

3

David Sainsbury

ES No
Client Stage
Int Stage
Date
Op

119504
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21.05.97
jennie

Volume
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Name
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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
02-03 Chairman’s
Incarnatus

ES No
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Int Stage
Date
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Volume
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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
02-03 Chairman’s
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Board of Directors

Robin Whitbread. 
Retail Director,
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1990. 
Age 46. 

Bob Cooper. 
Trading Director, 
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1988.
Age 48. 

John Adshead CBE. 
Personnel Director, 
J Sainsbury plc and 
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1989. 
Age 51. 

Tom Vyner. 
Deputy Chairman.
Appointed to Board in 1978. 
Age 60. 
(Nomination Committee)

David Clapham. 
Special Business Units and
Services Director,
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1992. 
Age 50. 

Kevin McCarten. 
Marketing Director,
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1995. 
Age 39. 

Ian Coull. 
Property Director, 
J Sainsbury plc and 
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1988.
Age 46.

Rosemary Thorne. 
Group Finance Director. 
Appointed to Board in 1992. 
Age 45.

Dino Adriano. 
Chief Executive, UK Food Retailing Businesses.
Appointed to Board in 1990. 
Age 54. 

David Sainsbury. 
Chairman. 
Appointed to Board in 1966. 
Age 56. 
(Chairman, Nomination Committee)

David Bremner. 
Chief Executive, Homebase and US Businesses. 
Appointed to Board in 1996. 
Age 39.

Dr John Ashworth. 
Non-Executive Director. 
Appointed to Board in 1993. 
Age 58. 
(Audit, Remuneration and
Nomination Committees)

Sir Clive Thompson. 
Non-Executive Director, 
Chairman, Remuneration
Committee.
Appointed to Board in 1995. 
Age 54. 
(Audit, Remuneration and
Nomination Committees)

Sir Terence Heiser GCB. 
Non-Executive Director, 
Chairman, Audit Committee. 
Appointed to Board in 1992. 
Age 64. 
(Audit, Remuneration and
Nomination Committees)

The Rt Hon 
Sir Timothy Sainsbury. 
Non-Executive Director. 
Appointed to Board in 1995. 
Age 64. 
(Audit, Remuneration and
Nomination Committees)

Sir David Scholey CBE.
Non-Executive Director. 
Appointed to Board in 1996. 
Age 61. 
(Audit, Remuneration and
Nomination Committees)

4

J Sainsbury plc

Lord Sainsbury of Drury Lane, Sir Robert Sainsbury, Lord Sainsbury of Preston Candover KG.

J Sainsbury plc

5

Joint Presidents

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Sainsburys > 119504 R&A Review 97 > .Documents
04-05 Directors
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Board of Directors

Robin Whitbread. 
Retail Director,
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1990. 
Age 46. 

Bob Cooper. 
Trading Director, 
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1988.
Age 48. 

John Adshead CBE. 
Personnel Director, 
J Sainsbury plc and 
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1989. 
Age 51. 

Tom Vyner. 
Deputy Chairman.
Appointed to Board in 1978. 
Age 60. 
(Nomination Committee)

David Clapham. 
Special Business Units and
Services Director,
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1992. 
Age 50. 

Kevin McCarten. 
Marketing Director,
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1995. 
Age 39. 

Ian Coull. 
Property Director, 
J Sainsbury plc and 
Sainsbury’s Supermarkets Ltd.
Appointed to Board in 1988.
Age 46.

Rosemary Thorne. 
Group Finance Director. 
Appointed to Board in 1992. 
Age 45.

Dino Adriano. 
Chief Executive, UK Food Retailing Businesses.
Appointed to Board in 1990. 
Age 54. 

David Sainsbury. 
Chairman. 
Appointed to Board in 1966. 
Age 56. 
(Chairman, Nomination Committee)

David Bremner. 
Chief Executive, Homebase and US Businesses. 
Appointed to Board in 1996. 
Age 39.

Dr John Ashworth. 
Non-Executive Director. 
Appointed to Board in 1993. 
Age 58. 
(Audit, Remuneration and
Nomination Committees)

Sir Clive Thompson. 
Non-Executive Director, 
Chairman, Remuneration
Committee.
Appointed to Board in 1995. 
Age 54. 
(Audit, Remuneration and
Nomination Committees)

Sir Terence Heiser GCB. 
Non-Executive Director, 
Chairman, Audit Committee. 
Appointed to Board in 1992. 
Age 64. 
(Audit, Remuneration and
Nomination Committees)

The Rt Hon 
Sir Timothy Sainsbury. 
Non-Executive Director. 
Appointed to Board in 1995. 
Age 64. 
(Audit, Remuneration and
Nomination Committees)

Sir David Scholey CBE.
Non-Executive Director. 
Appointed to Board in 1996. 
Age 61. 
(Audit, Remuneration and
Nomination Committees)

4

J Sainsbury plc

Lord Sainsbury of Drury Lane, Sir Robert Sainsbury, Lord Sainsbury of Preston Candover KG.

J Sainsbury plc

5

Joint Presidents

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Sainsburys > 119504 R&A Review 97 > .Documents
04-05 Directors
Incarnatus

ES No
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MB

Volume
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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
04-05 Directors
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Chief Executive’s Review – UK Food Retailing Businesses

My priority as Chief Executive is to rebuild the

superiority of our offer and to ensure that we achieve

our business mission of ‘always striving to be the

customer’s first choice for food shopping’.

In a highly competitive market, Sainsbury’s

Supermarkets’ sales increased by 6%. Like-for-like

sales growth improved during the year from 2.7% in

the first half to 3.7% in the second half, despite a

reduction in sales inflation from 4% in the first half to

less than 3% in the second half. Our market share rose

from 12.5% to 12.^6%. Operating profit was down by

11.1% as a result of the petrol price war and

investment in the Reward Card, stock availability,

customer service and training. 

Plans to implement our new strategy, designed to

re-establish Sainsbury’s as the ‘customer’s first choice

for food shopping’, were progressed during the

financial year. Our key strategies are to enhance

product quality and choice, build customer loyalty,

provide consistent product availability and deliver high

standards of service to our customers. The major costs

of implementing these have already been incurred.

Central to the customer offer was the Reward

Card launched in June1996 and enhanced by the Extra

Reward Points promotion from November. There are

now over nine million Reward Cards in issue. 

Rebuilding our superiority in quality and choice is

the key to maintaining our sales and market share

momentum. The structure of the Trading Division has

been streamlined to enable our buyers to give higher

priority to new product development. We

increased product development

resources and we are now

communicating improvements

in quality to customers through

our ‘Better Quality. . . Same Price’

promotion. We plan to improve or

replace at least one-fifth of our own

brand range each year.

each year for the rest of the decade.

We opened 18 stores in 1996/97

and plan a further 18 openings 

in the coming year. Our

programme of extensions

continues with 17 more

planned in the coming year,

and there is scope for major

extensions at a further 80 stores.

The Savacentre format will continue to be a

To achieve outstanding quality and

complementary part of our development programme.

choice, we are changing our approach to

We have instituted a strategic review of Savacentre’s

the management of product categories. During the

non-food offer in order to fulfil customer needs better.

next 18 months we will introduce a fully integrated

I believe these programmes of change and

structure for category management. 

development will generate positive results and I have

We improved our overall levels of product

established four key objectives for the business in the

availability during the second half of the financial year.

coming year. Firstly, I expect to see customers’

Performance regularly approached our target of 95%

perception of our quality and value for money improve

availability to customers at the end of the trading day.

relative to that of our competitors. Secondly, I am

There is still room for improvement. It is our goal to

determined to sustain positive like-for-like volume

give our customers outstanding levels of availability 

growth of between 1% and 2% in the current year and

in all our stores at all times of the day and on all days

to increase market share at a faster rate. Thirdly, I am

of the week.

planning for net margins to stabilise at or above last

The current planning environment has reduced

year’s levels, before Year 2000 systems costs. And

growth of new space for the sector as a whole to

fourthly, I aim to open 18 new stores and add over

between 2% and 3%, approximately in balance with

500,000 sq. ft. of profitable selling space. 

market growth. With the increasing use of new

The recovery of our business will not be an

formats, such as ‘Country Town’ stores, we anticipate

overnight phenomenon but we have started a process

being able to expand sales area by between 4% and 5%

of consistent and far-reaching improvement.

Dino Adriano, Chief Executive, UK Food Retailing Businesses, talking to Sharon Bernard, Delicatessen Assistant, in the new Sainsbury’s store at
Clapham, London which opened in November 1996.

6

7

ES No
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Date
Op

119504
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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
06-07 CEO Review
Incarnatus

ES No
Client Stage
Int Stage
Date
Op

119504
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21.05.97
jennie

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
06-07 CEO Review
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Chief Executive’s Review – UK Food Retailing Businesses

My priority as Chief Executive is to rebuild the

superiority of our offer and to ensure that we achieve

our business mission of ‘always striving to be the

customer’s first choice for food shopping’.

In a highly competitive market, Sainsbury’s

Supermarkets’ sales increased by 6%. Like-for-like

sales growth improved during the year from 2.7% in

the first half to 3.7% in the second half, despite a

reduction in sales inflation from 4% in the first half to

less than 3% in the second half. Our market share rose

from 12.5% to 12.^6%. Operating profit was down by

11.1% as a result of the petrol price war and

investment in the Reward Card, stock availability,

customer service and training. 

Plans to implement our new strategy, designed to

re-establish Sainsbury’s as the ‘customer’s first choice

for food shopping’, were progressed during the

financial year. Our key strategies are to enhance

product quality and choice, build customer loyalty,

provide consistent product availability and deliver high

standards of service to our customers. The major costs

of implementing these have already been incurred.

Central to the customer offer was the Reward

Card launched in June1996 and enhanced by the Extra

Reward Points promotion from November. There are

now over nine million Reward Cards in issue. 

Rebuilding our superiority in quality and choice is

the key to maintaining our sales and market share

momentum. The structure of the Trading Division has

been streamlined to enable our buyers to give higher

priority to new product development. We

increased product development

resources and we are now

communicating improvements

in quality to customers through

our ‘Better Quality. . . Same Price’

promotion. We plan to improve or

replace at least one-fifth of our own

brand range each year.

each year for the rest of the decade.

We opened 18 stores in 1996/97

and plan a further 18 openings 

in the coming year. Our

programme of extensions

continues with 17 more

planned in the coming year,

and there is scope for major

extensions at a further 80 stores.

The Savacentre format will continue to be a

To achieve outstanding quality and

complementary part of our development programme.

choice, we are changing our approach to

We have instituted a strategic review of Savacentre’s

the management of product categories. During the

non-food offer in order to fulfil customer needs better.

next 18 months we will introduce a fully integrated

I believe these programmes of change and

structure for category management. 

development will generate positive results and I have

We improved our overall levels of product

established four key objectives for the business in the

availability during the second half of the financial year.

coming year. Firstly, I expect to see customers’

Performance regularly approached our target of 95%

perception of our quality and value for money improve

availability to customers at the end of the trading day.

relative to that of our competitors. Secondly, I am

There is still room for improvement. It is our goal to

determined to sustain positive like-for-like volume

give our customers outstanding levels of availability 

growth of between 1% and 2% in the current year and

in all our stores at all times of the day and on all days

to increase market share at a faster rate. Thirdly, I am

of the week.

planning for net margins to stabilise at or above last

The current planning environment has reduced

year’s levels, before Year 2000 systems costs. And

growth of new space for the sector as a whole to

fourthly, I aim to open 18 new stores and add over

between 2% and 3%, approximately in balance with

500,000 sq. ft. of profitable selling space. 

market growth. With the increasing use of new

The recovery of our business will not be an

formats, such as ‘Country Town’ stores, we anticipate

overnight phenomenon but we have started a process

being able to expand sales area by between 4% and 5%

of consistent and far-reaching improvement.

Dino Adriano, Chief Executive, UK Food Retailing Businesses, talking to Sharon Bernard, Delicatessen Assistant, in the new Sainsbury’s store at
Clapham, London which opened in November 1996.

6

7

ES No
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Int Stage
Date
Op

119504
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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
06-07 CEO Review
Incarnatus

ES No
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Int Stage
Date
Op

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21.05.97
jennie

Volume
Path
Name
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Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
06-07 CEO Review
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Sainsbury’s Supermarkets –
‘always striving to be the customer’s first choice for food shopping’

The restructured and refocused Sainsbury’s

Price’ promotion. Examples of the improvements include

Supermarkets business aims to become, and to be

lasagne with richer bolognaise sauce, hot cross buns

recognised once again as, the nation’s best supermarket

with fresh lemon peel, and pizzas with extra and fuller

operator. 

flavour cheese. 

Key to the achievement in sales uplift was the

A large store typically offers 9,500 Sainsbury brand

development of a new supermarket strategy. Leading from

lines and 11,500 manufacturers’ lines. During the year,

this is the commitment to provide outstanding availability,

sales of Sainsbury brand products accounted for about

excellent customer service and superior quality and

two-thirds of total sales. Following a trial on the Cooking

choice, while giving customers very competitive prices.

Sauce range, which resulted in significant improvements

Analysis

1997

1996

of all product ranges is being conducted. The ranges for

Sales (incl. taxes)

£10,752.2m

£10,148.1m

detergents, breakfast cereals, nappies, soft drinks and

to customer choice and sales, a review of the management

Operating Profit 

£661.5m

£744.3m

Number of supermarkets

378

Sales area (’000 sq. ft.)

Full-time employees

Part-time employees

10,387

38,375

83,190

363

9,767

36,082

79,746

dental care are amongst the first to have been rebalanced. 

Sainsbury’s has continued to work in partnership

with suppliers to ensure safety and quality. In addition to

re-enforcing the ‘Farm Assured Meat’ programme to

improve customer confidence, consumer concerns about

Particular attention was paid to improving the

genetically modified foods are being addressed. In

quality and store presentation of fresh foods. Shelf

particular, Sainsbury’s would like to see the segregation

space allocated to fresh foods has been increased by

of genetically modified crops from conventional crops so

15% in new stores, extensions and major refurbishments.

that customers can make an informed choice when buying

There are now 157 fresh meat counters, 181 fresh fish

food products containing genetically modified ingredients.

counters and 328 delicatessen counters. Bakeries are

Sainsbury’s has also been active in promoting

in 377 stores and a full range of Fresh ‘N’ Ready fruit,

organic produce, and is currently the

vegetables and salads is available throughout the chain. 

leader in this market. To help address

During the year, over 1,000 new own brand

the shortfall in supply levels and improve

products were introduced and 500 existing lines were

availability of organic products

replaced. In March 1997, the launch of 250 improved

generally, the company sponsored 10

products marked the start of the ‘Better Quality. . . Same

suppliers of conventional produce to

Self-scanning will be available in 50 stores by December 1997. It has proved popular with customers enabling them to
shop more quickly.

Directors

Dino Adriano
Chairman

John Adshead CBE

David Clapham

Bob Cooper

Ian Coull

Hamish Elvidge

Kevin McCarten

Robin Whitbread

9

ES No
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Int Stage
Date
Op

119504
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Two
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jennie

Volume
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Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
08-09 Supermarkets
Incarnatus

ES No
Client Stage
Int Stage
Date
Op

119504
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Five
21.05.97
Jennie

Volume
Path
Name
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Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
08-09 Supermarkets
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Sainsbury’s Supermarkets –
‘always striving to be the customer’s first choice for food shopping’

The restructured and refocused Sainsbury’s

Price’ promotion. Examples of the improvements include

Supermarkets business aims to become, and to be

lasagne with richer bolognaise sauce, hot cross buns

recognised once again as, the nation’s best supermarket

with fresh lemon peel, and pizzas with extra and fuller

operator. 

flavour cheese. 

Key to the achievement in sales uplift was the

A large store typically offers 9,500 Sainsbury brand

development of a new supermarket strategy. Leading from

lines and 11,500 manufacturers’ lines. During the year,

this is the commitment to provide outstanding availability,

sales of Sainsbury brand products accounted for about

excellent customer service and superior quality and

two-thirds of total sales. Following a trial on the Cooking

choice, while giving customers very competitive prices.

Sauce range, which resulted in significant improvements

Analysis

1997

1996

of all product ranges is being conducted. The ranges for

Sales (incl. taxes)

£10,752.2m

£10,148.1m

detergents, breakfast cereals, nappies, soft drinks and

to customer choice and sales, a review of the management

Operating Profit 

£661.5m

£744.3m

Number of supermarkets

378

Sales area (’000 sq. ft.)

Full-time employees

Part-time employees

10,387

38,375

83,190

363

9,767

36,082

79,746

dental care are amongst the first to have been rebalanced. 

Sainsbury’s has continued to work in partnership

with suppliers to ensure safety and quality. In addition to

re-enforcing the ‘Farm Assured Meat’ programme to

improve customer confidence, consumer concerns about

Particular attention was paid to improving the

genetically modified foods are being addressed. In

quality and store presentation of fresh foods. Shelf

particular, Sainsbury’s would like to see the segregation

space allocated to fresh foods has been increased by

of genetically modified crops from conventional crops so

15% in new stores, extensions and major refurbishments.

that customers can make an informed choice when buying

There are now 157 fresh meat counters, 181 fresh fish

food products containing genetically modified ingredients.

counters and 328 delicatessen counters. Bakeries are

Sainsbury’s has also been active in promoting

in 377 stores and a full range of Fresh ‘N’ Ready fruit,

organic produce, and is currently the

vegetables and salads is available throughout the chain. 

leader in this market. To help address

During the year, over 1,000 new own brand

the shortfall in supply levels and improve

products were introduced and 500 existing lines were

availability of organic products

replaced. In March 1997, the launch of 250 improved

generally, the company sponsored 10

products marked the start of the ‘Better Quality. . . Same

suppliers of conventional produce to

Self-scanning will be available in 50 stores by December 1997. It has proved popular with customers enabling them to
shop more quickly.

Directors

Dino Adriano
Chairman

John Adshead CBE

David Clapham

Bob Cooper

Ian Coull

Hamish Elvidge

Kevin McCarten

Robin Whitbread

9

ES No
Client Stage
Int Stage
Date
Op

119504
Two
Two
09.05.97
jennie

Volume
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Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
08-09 Supermarkets
Incarnatus

ES No
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Int Stage
Date
Op

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21.05.97
Jennie

Volume
Path
Name
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Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
08-09 Supermarkets
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

attend the Soil Association’s national conference on

trialled during the year. ‘Express Shop’, the use of 

organic food production. Sainsbury’s is also working

self-scanning equipment for Reward Card holders, was

with various international charity and non-governmental

introduced at Watchmoor Park, Camberley last

organisations to develop a Code of Conduct that will

November. The service, now available in seven stores, is

assist in monitoring own brand suppliers worldwide on

expected to be available in 50 stores by December. 

social and environmental concerns.

Watford and Solihull stores are trialling ‘Order 

Sainsbury’s was voted by Woman magazine as

& Collect’. Customers telephone or fax their order for

the supermarket with the most exciting new foods on

picking by store staff. Later this year, more than 20,000

offer. Sainsbury’s Indulgence Merry Christmas Pudding

lines will be shown on Sainsbury’s web site on the Internet,

ice cream was one of a number of products to win an

award during the year. 

building on the success of another trial – a closed
network Electronic Shop.

A new flower shop was trialled at the Cobham

Sainsbury’s Supermarkets employs more than

store and improved floral displays have been

121,000 people: two-thirds are women and the same

introduced in the other 337 stores selling flowers. A new

proportion work part time. Following the extension of

style coffee shop, Espresso, forms part of the new store

trading hours in June 1996 to 10pm on certain nights,

at Winnersh which opened in March 1997.

most stores now open for over 80 hours a week.

The Reward Card was launched in June 1996.

The process of communicating with staff was

Customers now use a Reward Card for 60% of

reviewed and improved during the year. In September

transactions accounting for over 80% of sales. The nine

million or more Reward Card holders can choose to take

their points as Sainsbury Reward vouchers, Air Miles,

or use them to obtain a discount on services provided

by other companies with whom special deals have

been negotiated. These include discounts on telephone

bills, photo processing, dry cleaning and meals out. 

Sainsbury’s continued to maintain a highly

competitive price position across its product range.

Prices were on average 2% below major competitors.

A number of alternative forms of shopping were

The Fresh ‘N’ Ready range now includes 63 fruit, vegetable and salad products.

Blackcurrant cheesecake now has 10% more fruit, for the same
price. Sales of this product have doubled since the launch of the
‘Better Quality…

˘...Same Price’ promotion.

11

ES No
Client Stage
Int Stage
Date
Op

119504
Three
Three
20.05.97
ola

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
10-11 Supermarkets
Incarnatus

ES No
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Int Stage
Date
Op

119504
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Four
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deb

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
10-11 Supermarkets
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
æ
≥
…
Æ
¯
(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

attend the Soil Association’s national conference on

trialled during the year. ‘Express Shop’, the use of 

organic food production. Sainsbury’s is also working

self-scanning equipment for Reward Card holders, was

with various international charity and non-governmental

introduced at Watchmoor Park, Camberley last

organisations to develop a Code of Conduct that will

November. The service, now available in seven stores, is

assist in monitoring own brand suppliers worldwide on

expected to be available in 50 stores by December. 

social and environmental concerns.

Watford and Solihull stores are trialling ‘Order 

Sainsbury’s was voted by Woman magazine as

& Collect’. Customers telephone or fax their order for

the supermarket with the most exciting new foods on

picking by store staff. Later this year, more than 20,000

offer. Sainsbury’s Indulgence Merry Christmas Pudding

lines will be shown on Sainsbury’s web site on the Internet,

ice cream was one of a number of products to win an

award during the year. 

building on the success of another trial – a closed
network Electronic Shop.

A new flower shop was trialled at the Cobham

Sainsbury’s Supermarkets employs more than

store and improved floral displays have been

121,000 people: two-thirds are women and the same

introduced in the other 337 stores selling flowers. A new

proportion work part time. Following the extension of

style coffee shop, Espresso, forms part of the new store

trading hours in June 1996 to 10pm on certain nights,

at Winnersh which opened in March 1997.

most stores now open for over 80 hours a week.

The Reward Card was launched in June 1996.

The process of communicating with staff was

Customers now use a Reward Card for 60% of

reviewed and improved during the year. In September

transactions accounting for over 80% of sales. The nine

million or more Reward Card holders can choose to take

their points as Sainsbury Reward vouchers, Air Miles,

or use them to obtain a discount on services provided

by other companies with whom special deals have

been negotiated. These include discounts on telephone

bills, photo processing, dry cleaning and meals out. 

Sainsbury’s continued to maintain a highly

competitive price position across its product range.

Prices were on average 2% below major competitors.

A number of alternative forms of shopping were

The Fresh ‘N’ Ready range now includes 63 fruit, vegetable and salad products.

Blackcurrant cheesecake now has 10% more fruit, for the same
price. Sales of this product have doubled since the launch of the
‘Better Quality…

˘...Same Price’ promotion.

11

ES No
Client Stage
Int Stage
Date
Op

119504
Three
Three
20.05.97
ola

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
10-11 Supermarkets
Incarnatus

ES No
Client Stage
Int Stage
Date
Op

119504
Five
Four
22.05.97
deb

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
10-11 Supermarkets
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
æ
≥
…
Æ
¯
(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

The Forestside, Belfast store is one of
the two stores to open in Northern
Ireland and is trading far above
expectations.

1996, Business TV was launched. Using an encrypted

satellite transmission service, the live and interactive

programmes go out regularly to all stores and office

locations and have significantly improved the speed

and quality of internal communications. Also new this

year was the establishment of Staff Councils with

representatives drawn from all areas and levels of 

the business. These provide a forum for consultation

and information.

Sainsbury’s continued to make training a priority

with the introduction in June 1996 of a new training

programme called Operational Skills. The training

needs of all staff were re-assessed and more than

with customers, have also raised funds for national and

50,000 took the opportunity for enhanced operational

local charitable causes. More than £500,000 was

skills training. In addition to training for job-specific

raised in the year for BBC Children In Need, bringing

skills, staff continued to be encouraged to progress

the total raised for this charity alone to over £2 million

their personal development and over 1,500 adult

in the last six years. Support has also been given to

members of staff now either have, or are progressing

local communities through Arts Sponsorship and Town

towards, a Level 2 National Vocational Qualification. 

Centre Management initiatives.

As part of its ongoing commitment to training

Some £450 million was invested in 18 new

Sainsbury’s is working towards the Investors In People

stores and 22 extensions providing 668,000 sq. ft. of

award for all areas of its business by the year 2000.

new sales area. The openings included the first two

Three stores, Ripley, Belgrave Road, Leicester, and

stores in Northern Ireland, Ballymena and Forestside,

Market Harborough, have already achieved the award.

Belfast, and the first two stores in the ‘Country Town’

The Side By Side scheme, which encourages staff

format, which typically have a sales area of between

to become actively involved in local community

15,000 -20,000 sq. ft., March and Melksham. 

projects, is now in 150 stores. Emphasis this year has

Eighteen new stores are planned in the coming

been on projects working with children, elderly people

year. This includes further stores in Northern Ireland

and those with disabilities. Staff at all stores, together

and in the ‘Country Town’ format. 

The video wall at the new store in Clapham, London is the largest in Europe. 
It provides an attractive and entertaining new dimension to the High Street.

13

ES No
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Int Stage
Date
Op

119504
Three
Three
20.05.97
ola

Volume
Path
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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
12-13 Supermarkets
Incarnatus

ES No
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Int Stage
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Op

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Six
21.05.97
Jennie

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
12-13 Supermarkets
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

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The Forestside, Belfast store is one of
the two stores to open in Northern
Ireland and is trading far above
expectations.

1996, Business TV was launched. Using an encrypted

satellite transmission service, the live and interactive

programmes go out regularly to all stores and office

locations and have significantly improved the speed

and quality of internal communications. Also new this

year was the establishment of Staff Councils with

representatives drawn from all areas and levels of 

the business. These provide a forum for consultation

and information.

Sainsbury’s continued to make training a priority

with the introduction in June 1996 of a new training

programme called Operational Skills. The training

needs of all staff were re-assessed and more than

with customers, have also raised funds for national and

50,000 took the opportunity for enhanced operational

local charitable causes. More than £500,000 was

skills training. In addition to training for job-specific

raised in the year for BBC Children In Need, bringing

skills, staff continued to be encouraged to progress

the total raised for this charity alone to over £2 million

their personal development and over 1,500 adult

in the last six years. Support has also been given to

members of staff now either have, or are progressing

local communities through Arts Sponsorship and Town

towards, a Level 2 National Vocational Qualification. 

Centre Management initiatives.

As part of its ongoing commitment to training

Some £450 million was invested in 18 new

Sainsbury’s is working towards the Investors In People

stores and 22 extensions providing 668,000 sq. ft. of

award for all areas of its business by the year 2000.

new sales area. The openings included the first two

Three stores, Ripley, Belgrave Road, Leicester, and

stores in Northern Ireland, Ballymena and Forestside,

Market Harborough, have already achieved the award.

Belfast, and the first two stores in the ‘Country Town’

The Side By Side scheme, which encourages staff

format, which typically have a sales area of between

to become actively involved in local community

15,000 -20,000 sq. ft., March and Melksham. 

projects, is now in 150 stores. Emphasis this year has

Eighteen new stores are planned in the coming

been on projects working with children, elderly people

year. This includes further stores in Northern Ireland

and those with disabilities. Staff at all stores, together

and in the ‘Country Town’ format. 

The video wall at the new store in Clapham, London is the largest in Europe. 
It provides an attractive and entertaining new dimension to the High Street.

13

ES No
Client Stage
Int Stage
Date
Op

119504
Three
Three
20.05.97
ola

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
12-13 Supermarkets
Incarnatus

ES No
Client Stage
Int Stage
Date
Op

119504
Five
Six
21.05.97
Jennie

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
12-13 Supermarkets
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
(cid:2)
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Savacentre – committed to 
innovation, expansion and improved performance

In a highly competitive environment, Savacentre

new petrol station. At Merton, customers can choose

achieved sales growth of 6.8% to £802 million. 

between a McDonald’s or a Morelli Italian style

Operating profit fell by 11.9% to £30.3 million

restaurant, and customers with disabilities now have a

reflecting the petrol price war and investment in the

dedicated parking area, which is accessible only by

Reward Card and customer service. No new stores were

arrangement.

opened during the financial year. Sales at Sydenham and

Extended trading hours are well established with

Stockton, which both opened in 1995, grew at record

customers and many stores now open until 10pm.

levels for new Savacentre openings. The sales

During the busy Christmas period, the Edinburgh store

performance was also enhanced by the Reward Card

opened through the night providing greater flexibility,

with some 400,000 customers choosing a Savacentre 

convenience and a less crowded shopping environment.

hypermarket as their home store.

Savacentre employs over 10,000 people. Training

Analysis

Sales (incl. taxes)

Operating Profit 

Number of hypermarkets

Sales area (’000 sq. ft.)

Full-time employees

Part-time employees

1997

£802.0m

£30.3m

12

1,034

3,023

7,527

1996

£751.2m

£34.4m

12

1,034

2,796

7,002

programmes are available to staff at all levels to help

improve their performance in their current job as well as

to help personal development. Recent additions include

courses for electrical department staff and 

pre-seasonal courses for staff handling bedding plants

and garden shrubs. 

The stores remain active in their local

communities providing a wide range of charitable

In September the Savacentre clothing range was
relaunched under the new brand name I.N.I.T.I.A.L.S. This
exclusive range aims to be stylish, practical and

contributions from Variety Club coaches to sponsorship

of horse riding facilities for children with disabilities. 

Savacentre plans to open a new store every 18

fashionable as well as good value for money. 

months. The thirteenth store opened in Leeds just after

Also new instore are DIY and bathroom shops and

the year end in March 1997. It includes

new concessions, such as NEXT childrenswear at London

many new design features such as the

Colney and Daewoo car concessions at three stores. 

Curry Kitchen offering curry ready

During the year, the Oldbury store was enhanced

meals, a Salad Bar and a new format

by the opening of a children’s play centre, a major

restaurant. The next planned opening

refurbishment of the restaurant and the addition of a

is at Braehead, Glasgow in1999. 

The thirteenth Savacentre opened in March 1997 in the White Rose Shopping Centre, Leeds. With a sales area of
85,000 sq. ft., it includes many established features, such as Cookshop, as well as newer ones. 

Directors

Ian Coull
Chairman

Colin Harvey
Managing Director

Edward Bonner

David Empson

John J O’Sullivan

Allan Webb

Robin Anderson*

Trefor Hales*

Andrew Mitcham*

*Non-Executive 

15

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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
14-15 Savacentre
Incarnatus

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Volume
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Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
14-15 Savacentre
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

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Savacentre – committed to 
innovation, expansion and improved performance

In a highly competitive environment, Savacentre

new petrol station. At Merton, customers can choose

achieved sales growth of 6.8% to £802 million. 

between a McDonald’s or a Morelli Italian style

Operating profit fell by 11.9% to £30.3 million

restaurant, and customers with disabilities now have a

reflecting the petrol price war and investment in the

dedicated parking area, which is accessible only by

Reward Card and customer service. No new stores were

arrangement.

opened during the financial year. Sales at Sydenham and

Extended trading hours are well established with

Stockton, which both opened in 1995, grew at record

customers and many stores now open until 10pm.

levels for new Savacentre openings. The sales

During the busy Christmas period, the Edinburgh store

performance was also enhanced by the Reward Card

opened through the night providing greater flexibility,

with some 400,000 customers choosing a Savacentre 

convenience and a less crowded shopping environment.

hypermarket as their home store.

Savacentre employs over 10,000 people. Training

Analysis

Sales (incl. taxes)

Operating Profit 

Number of hypermarkets

Sales area (’000 sq. ft.)

Full-time employees

Part-time employees

1997

£802.0m

£30.3m

12

1,034

3,023

7,527

1996

£751.2m

£34.4m

12

1,034

2,796

7,002

programmes are available to staff at all levels to help

improve their performance in their current job as well as

to help personal development. Recent additions include

courses for electrical department staff and 

pre-seasonal courses for staff handling bedding plants

and garden shrubs. 

The stores remain active in their local

communities providing a wide range of charitable

In September the Savacentre clothing range was
relaunched under the new brand name I.N.I.T.I.A.L.S. This
exclusive range aims to be stylish, practical and

contributions from Variety Club coaches to sponsorship

of horse riding facilities for children with disabilities. 

Savacentre plans to open a new store every 18

fashionable as well as good value for money. 

months. The thirteenth store opened in Leeds just after

Also new instore are DIY and bathroom shops and

the year end in March 1997. It includes

new concessions, such as NEXT childrenswear at London

many new design features such as the

Colney and Daewoo car concessions at three stores. 

Curry Kitchen offering curry ready

During the year, the Oldbury store was enhanced

meals, a Salad Bar and a new format

by the opening of a children’s play centre, a major

restaurant. The next planned opening

refurbishment of the restaurant and the addition of a

is at Braehead, Glasgow in1999. 

The thirteenth Savacentre opened in March 1997 in the White Rose Shopping Centre, Leeds. With a sales area of
85,000 sq. ft., it includes many established features, such as Cookshop, as well as newer ones. 

Directors

Ian Coull
Chairman

Colin Harvey
Managing Director

Edward Bonner

David Empson

John J O’Sullivan

Allan Webb

Robin Anderson*

Trefor Hales*

Andrew Mitcham*

*Non-Executive 

15

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Date
Op

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14-15 Savacentre
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Int Stage
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Volume
Path
Name
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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
14-15 Savacentre
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
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Chief Executive’s Review – Homebase and US Businesses

To realise the full potential of the remaining

October 1996. This acquisition led to lower profits in

stores we will accelerate the conversion programme

the second half than had been expected. Overall sales

and have provided £50 million of exceptional costs to

for the year grew by 12.4% to @$2.5 billion but

do this.

operating profit fell by 15.4%, on a 52-week basis, to

These costs break down into three areas:

@$65.2 million.

converting 65 additional stores, more extensive

I have set Shaw’s the following four targets.

conversion work on each store, and range and supply

Firstly, we will improve the operating margins in the

chain integration.

established markets through improved sales and

I have set the business five short-term targets and

increased efficiencies. Secondly, we will seek to make

one long-term goal. The long-term goal is to achieve a

our stores in Connecticut the customers’ first choice

return on net assets of around 17% in the year 2000

for food shopping by delivering a differentiated offer

when we complete the conversion programme. In the

based on Shaw’s highly competitive, every day low price

short term we plan to open 10 new stores in 1997/98;

groceries and quality perishables built on the heritage

to target 60 conversions, so that by the end of the

of Shaw’s and Sainsbury’s. Thirdly, we will establish

year over half of the acquired stores will be in the

Shaw’s as the second largest supermarket operator in

Homebase format; to achieve an operating margin of

Connecticut. And fourthly, we are targeting a return on

between 7% and 8% in converted stores; to regain lost

net assets of 15%, including the Connecticut expansion,

In the UK, the Homebase business has grown its

proceeded with range integration and by the year end

customers in the as yet unconverted stores and

by the year 2000.

operating margins for 12 consecutive years and its real

this was 90% complete.

achieve a like-for-like sales increase in these stores of

Giant, in which we increased our holding to

like-for-like sales for the last six years. Sales this year

In total, the former Texas business incurred a loss

5%; and to achieve growth in the original Homebase

approximately 20% in August 1996, is our other interest

increased by 15.7% to £492 million and operating

of £29 million for the year due mainly to the additional

stores at least in line with the market.

in the US. 

profit rose by 25.1% to £45.3 million.

costs of and the disruption caused by integration with

I am confident that these targets are demanding,

Business there was severely disrupted by a strike

The key strengths of Homebase – product range,
customer service and good space management – now
have to be deployed in the enlarged business. 

Homebase. However, we achieved a strong performance

in those stores we fully converted to the Homebase

format. On average these stores have achieved a

realistic and achievable.

of distribution staff in the fourth quarter. During that

Turning to the US, Shaw’s made steady progress

quarter, sales fell 6.9% on a like-for-like basis, but

in its established markets where it increased operating

profits were down by over 60% to $28.7 million

By the year end, we had converted 40 Texas

cumulative sales increase of almost 40% and raised

profit by 10% and achieved a return on net assets of

compared with $73.4 million for the same quarter the

stores to the Homebase format and, eliminating the

operating margins to over 8%, supporting our decision

16%. During the year Shaw’s expanded its store base

previous year. A satisfactory solution to the strike was

Texas identity and brand, we rebadged the rest of the

to invest in people, systems and general controls ahead

by over 20%. This included the 12 stores in Connecticut

reached which will reduce costs and maintain flexibility,

Texas stores to the Homebase fascia. We have

of the conversion process. 

acquired from subsidiaries of Royal Ahold NV in

and sales are recovering. 

David Bremner, Chief Executive, Homebase and US Businesses, talking to a customer at the Homebase store in Kensington, London.

16

17

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Int Stage
Date
Op

119504
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Three
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deb

Volume
Path
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Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
16-17 CEO Review
Incarnatus

ES No
Client Stage
Int Stage
Date
Op

119504
Four
Four
22.05.97
deb

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
16-17 CEO Review
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

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Chief Executive’s Review – Homebase and US Businesses

To realise the full potential of the remaining

October 1996. This acquisition led to lower profits in

stores we will accelerate the conversion programme

the second half than had been expected. Overall sales

and have provided £50 million of exceptional costs to

for the year grew by 12.4% to @$2.5 billion but

do this.

operating profit fell by 15.4%, on a 52-week basis, to

These costs break down into three areas:

@$65.2 million.

converting 65 additional stores, more extensive

I have set Shaw’s the following four targets.

conversion work on each store, and range and supply

Firstly, we will improve the operating margins in the

chain integration.

established markets through improved sales and

I have set the business five short-term targets and

increased efficiencies. Secondly, we will seek to make

one long-term goal. The long-term goal is to achieve a

our stores in Connecticut the customers’ first choice

return on net assets of around 17% in the year 2000

for food shopping by delivering a differentiated offer

when we complete the conversion programme. In the

based on Shaw’s highly competitive, every day low price

short term we plan to open 10 new stores in 1997/98;

groceries and quality perishables built on the heritage

to target 60 conversions, so that by the end of the

of Shaw’s and Sainsbury’s. Thirdly, we will establish

year over half of the acquired stores will be in the

Shaw’s as the second largest supermarket operator in

Homebase format; to achieve an operating margin of

Connecticut. And fourthly, we are targeting a return on

between 7% and 8% in converted stores; to regain lost

net assets of 15%, including the Connecticut expansion,

In the UK, the Homebase business has grown its

proceeded with range integration and by the year end

customers in the as yet unconverted stores and

by the year 2000.

operating margins for 12 consecutive years and its real

this was 90% complete.

achieve a like-for-like sales increase in these stores of

Giant, in which we increased our holding to

like-for-like sales for the last six years. Sales this year

In total, the former Texas business incurred a loss

5%; and to achieve growth in the original Homebase

approximately 20% in August 1996, is our other interest

increased by 15.7% to £492 million and operating

of £29 million for the year due mainly to the additional

stores at least in line with the market.

in the US. 

profit rose by 25.1% to £45.3 million.

costs of and the disruption caused by integration with

I am confident that these targets are demanding,

Business there was severely disrupted by a strike

The key strengths of Homebase – product range,
customer service and good space management – now
have to be deployed in the enlarged business. 

Homebase. However, we achieved a strong performance

in those stores we fully converted to the Homebase

format. On average these stores have achieved a

realistic and achievable.

of distribution staff in the fourth quarter. During that

Turning to the US, Shaw’s made steady progress

quarter, sales fell 6.9% on a like-for-like basis, but

in its established markets where it increased operating

profits were down by over 60% to $28.7 million

By the year end, we had converted 40 Texas

cumulative sales increase of almost 40% and raised

profit by 10% and achieved a return on net assets of

compared with $73.4 million for the same quarter the

stores to the Homebase format and, eliminating the

operating margins to over 8%, supporting our decision

16%. During the year Shaw’s expanded its store base

previous year. A satisfactory solution to the strike was

Texas identity and brand, we rebadged the rest of the

to invest in people, systems and general controls ahead

by over 20%. This included the 12 stores in Connecticut

reached which will reduce costs and maintain flexibility,

Texas stores to the Homebase fascia. We have

of the conversion process. 

acquired from subsidiaries of Royal Ahold NV in

and sales are recovering. 

David Bremner, Chief Executive, Homebase and US Businesses, talking to a customer at the Homebase store in Kensington, London.

16

17

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Op

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16-17 CEO Review
Incarnatus

ES No
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Op

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deb

Volume
Path
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Fonts
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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
16-17 CEO Review
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
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Homebase – firmly established as a national home improvement chain

This was a year of intense activity for Homebase,

This telesales service offers a range of insurance

delivering the accelerated programme of integration of the

products tailored to the Homebase customer. 

ex-Texas stores acquired the previous year. The original

Homebase continued to develop the concept of

Homebase stores had an excellent year with increases in

‘Shops within Shops’ with the introduction of new areas

sales of over 15% and in operating profit of 25%.

such as Cookshop and a new format wallpaper shop. 

Analysis – Homebase*

Sales (incl. taxes)

Operating Profit 

Number of stores

Sales area (’000 sq. ft.)

Full-time employees

Part-time employees

1997

£492.4m

£45.3m

99

3,826

3,617

6,663

1996

£425.7m

£36.2m

91

3,470(cid:2)

2,723

4,040

*Relates to core Homebase business. Ex-Texas Analysis on page 21.
(cid:2) Restated.

The 40 Texas stores which were fully converted

to the Homebase format by the year end performed

well with a cumulative sales uplift of 40% in the year.

The financial performance of the remaining Texas

stores was disappointing and collectively the ex-Texas

stores made a loss of £29 million. This loss reflected the

costs involved in accelerating the integration of the product

range, now nearing completion, and the considerable

investment in staff training, and in stock control and

Some five million customers are now active

replenishment systems associated with conversions.

Homebase Spend & Save cardholders. The loyalty card

The Texas name was dropped totally on 

continues to be popular and customers may now choose

2nd December – ‘H Day’ – when all remaining Texas

the option of Air Miles instead of vouchers redeemable

stores were rebadged to the Homebase fascia overnight.

in Homebase, Sainsbury’s or Savacentre stores.

The rebadging of the Texas stores created a national

The range of Homebase brand products continues

Homebase chain. 

to be strengthened. This year over 1,000 new or

The completion of the conversion programme is

improved lines were launched including several new

now the key to unlocking the remaining potential from

services to complement the Homebase offer.

the acquisition. Sixty conversions are planned for the

Homebase Living magazine was launched in March 1997.

coming year and it is envisaged that

In addition to promoting what is new instore, it carries

there will be a further 60 in the following

general interest features. Three editions of the magazine

year to complete the programme. This

a year are planned. 

is a demanding schedule involving

In February 1997, Homebase launched its Home

more than one store a week.

& Contents Insurance and other insurance packages.

To support the new nationwide 

The former Texas store at Bedford was one of 40 stores to have been fully converted to the Homebase format by the
year end. The fully converted stores typically show an uplift in sales of 40%.

Directors

David Bremner
Chairman

Ross McLaren
Managing Director

Ian Baldwin

Steve Bradbury

Peter Guildford

Mike Powell

Bob Cooper*

Ian Coull*

*Non-Executive 

19

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18-19 Homebase
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OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
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Homebase – firmly established as a national home improvement chain

This was a year of intense activity for Homebase,

This telesales service offers a range of insurance

delivering the accelerated programme of integration of the

products tailored to the Homebase customer. 

ex-Texas stores acquired the previous year. The original

Homebase continued to develop the concept of

Homebase stores had an excellent year with increases in

‘Shops within Shops’ with the introduction of new areas

sales of over 15% and in operating profit of 25%.

such as Cookshop and a new format wallpaper shop. 

Analysis – Homebase*

Sales (incl. taxes)

Operating Profit 

Number of stores

Sales area (’000 sq. ft.)

Full-time employees

Part-time employees

1997

£492.4m

£45.3m

99

3,826

3,617

6,663

1996

£425.7m

£36.2m

91

3,470(cid:2)

2,723

4,040

*Relates to core Homebase business. Ex-Texas Analysis on page 21.
(cid:2) Restated.

The 40 Texas stores which were fully converted

to the Homebase format by the year end performed

well with a cumulative sales uplift of 40% in the year.

The financial performance of the remaining Texas

stores was disappointing and collectively the ex-Texas

stores made a loss of £29 million. This loss reflected the

costs involved in accelerating the integration of the product

range, now nearing completion, and the considerable

investment in staff training, and in stock control and

Some five million customers are now active

replenishment systems associated with conversions.

Homebase Spend & Save cardholders. The loyalty card

The Texas name was dropped totally on 

continues to be popular and customers may now choose

2nd December – ‘H Day’ – when all remaining Texas

the option of Air Miles instead of vouchers redeemable

stores were rebadged to the Homebase fascia overnight.

in Homebase, Sainsbury’s or Savacentre stores.

The rebadging of the Texas stores created a national

The range of Homebase brand products continues

Homebase chain. 

to be strengthened. This year over 1,000 new or

The completion of the conversion programme is

improved lines were launched including several new

now the key to unlocking the remaining potential from

services to complement the Homebase offer.

the acquisition. Sixty conversions are planned for the

Homebase Living magazine was launched in March 1997.

coming year and it is envisaged that

In addition to promoting what is new instore, it carries

there will be a further 60 in the following

general interest features. Three editions of the magazine

year to complete the programme. This

a year are planned. 

is a demanding schedule involving

In February 1997, Homebase launched its Home

more than one store a week.

& Contents Insurance and other insurance packages.

To support the new nationwide 

The former Texas store at Bedford was one of 40 stores to have been fully converted to the Homebase format by the
year end. The fully converted stores typically show an uplift in sales of 40%.

Directors

David Bremner
Chairman

Ross McLaren
Managing Director

Ian Baldwin

Steve Bradbury

Peter Guildford

Mike Powell

Bob Cooper*

Ian Coull*

*Non-Executive 

19

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Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

chain of stores, the infrastructure to operate a national

Homebase’s commitment to training, its South West

distribution operation from Elgin in the north of

region successfully achieved the standards of the

Scotland to Camborne in Cornwall was established. 

Investors in People award earlier this year.

The former Texas depot in Wellingborough is

Customer service training played a key role in the

currently being extended and a replacement depot for

preparation of staff in the newly converted and rebadged

the horticultural business is under construction in

former Texas stores. Overall, staff performance during

a year of considerable change was outstanding.

Each year Homebase staff choose a corporate

charity and undertake events to raise funds. In March

1997, the £179,000 raised in this way was donated to

Marie Curie Cancer Care. In the coming year, staff

have voted to donate the funds they raise to Childline.

In addition to the activity on store conversions

and range integration, nine new Homebase stores

were successfully opened and a further 10 are planned

for the coming year. 

In February 1997,
Homebase launched
a range of insurance
products including 
a garden protection
scheme.

Swindon.

Analysis – Ex-Texas

Sales (incl. taxes)

Operating Loss

Number of stores

Sales area (’000 sq. ft.)

Full-time employees

Part-time employees

(cid:2) Restated.

1997

£641.7m

(£29.0m)

198

7,556

2,622

4,595

1996

£677.9m

(£10.4m)

219

8,162(cid:2)

3,240

7,040

‘H Day’ also marked the launch of Homebase FM,

the company’s own instore satellite radio station.

Homebase FM broadcasts special offers instore as well

as providing background entertainment for our

customers.

Homebase employs over 17,000 people: 

two-thirds work part time and the split between men

and women is about equal. During the year the

business recruited more management trainees than

ever before. It expanded its training facilities at Hadlow

Horticultural College, Kent and actively encouraged

staff to improve their personal development through

NVQs and other external courses. Demonstrating

Homebase’s Good Ideas Garden, featuring products and plants available in stores, won a Gold Medal and the
prestigious Tudor Rose award for the best ‘Show Garden’ at the 1996 Hampton Court Palace Flower Show.

21

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20-21 Homebase
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

chain of stores, the infrastructure to operate a national

Homebase’s commitment to training, its South West

distribution operation from Elgin in the north of

region successfully achieved the standards of the

Scotland to Camborne in Cornwall was established. 

Investors in People award earlier this year.

The former Texas depot in Wellingborough is

Customer service training played a key role in the

currently being extended and a replacement depot for

preparation of staff in the newly converted and rebadged

the horticultural business is under construction in

former Texas stores. Overall, staff performance during

a year of considerable change was outstanding.

Each year Homebase staff choose a corporate

charity and undertake events to raise funds. In March

1997, the £179,000 raised in this way was donated to

Marie Curie Cancer Care. In the coming year, staff

have voted to donate the funds they raise to Childline.

In addition to the activity on store conversions

and range integration, nine new Homebase stores

were successfully opened and a further 10 are planned

for the coming year. 

In February 1997,
Homebase launched
a range of insurance
products including 
a garden protection
scheme.

Swindon.

Analysis – Ex-Texas

Sales (incl. taxes)

Operating Loss

Number of stores

Sales area (’000 sq. ft.)

Full-time employees

Part-time employees

(cid:2) Restated.

1997

£641.7m

(£29.0m)

198

7,556

2,622

4,595

1996

£677.9m

(£10.4m)

219

8,162(cid:2)

3,240

7,040

‘H Day’ also marked the launch of Homebase FM,

the company’s own instore satellite radio station.

Homebase FM broadcasts special offers instore as well

as providing background entertainment for our

customers.

Homebase employs over 17,000 people: 

two-thirds work part time and the split between men

and women is about equal. During the year the

business recruited more management trainees than

ever before. It expanded its training facilities at Hadlow

Horticultural College, Kent and actively encouraged

staff to improve their personal development through

NVQs and other external courses. Demonstrating

Homebase’s Good Ideas Garden, featuring products and plants available in stores, won a Gold Medal and the
prestigious Tudor Rose award for the best ‘Show Garden’ at the 1996 Hampton Court Palace Flower Show.

21

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Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Shaw’s – serving more new customers in more New England states

Shaw’s serves two million customers each week.

are jointly sourced with Sainsbury’s, a range of luxury

It offers over 30,000 quality, value-for-money products

ice creams called Temptation, and flavoured cream

and the ongoing ‘Every Day Low Prices’ promotion

cheeses which are for use in recipes or as spreads. 

provides further savings. 

Analysis

Sales (incl. taxes)

Operating Profit 

Number of stores

Sales area (’000 sq. ft.)

Full-time associates

1997

$2.49bn

$65.2m

115

3,822

6,868

Part-time associates

13,151

*Results for 1996 are for a 54-week period.

1996*

$2.30bn

$80.0m

96

3,137

5,534

12,232

Shaw’s associates number around 20,000 people.

Over two-thirds are part time and there is an equal

proportion of men and women. One of Shaw’s latest

initiatives, demonstrating its ongoing commitment to

the training and development of associates, is ‘Shaw’s

University’, launched in June 1996. It offers a complete

curriculum to support career and individual development

in all areas of the business. 

All associates are encouraged to participate actively

in improving the quality of life in the communities in

Shaw’s has invested in the latest technology to

which they live and work. A principal focus for this

make shopping more convenient for customers. It was

activity is the United Way Campaign. During 1996/97

the first supermarket in New England to accept the

Shaw’s associates raised over $560,000 for this

national Quest Card for Electronic Benefits Payments

campaign, representing a 14% increase on the amount

and to offer self-checkout.

raised in the previous year.

Key to Shaw’s offer is the strength of the Shaw’s

Nineteen stores opened during 1996/97,

brand which is significantly different from those of its

including the 12 acquired in Connecticut. At the year

competitors. Shaw’s works with growers and

end, Shaw’s had a total of 115 stores in Massachusetts, 

manufacturers to ensure that all Shaw’s products meet

New Hampshire, Maine, Rhode Island and Connecticut.

its high standards and offers a money back guarantee

Since the year end the company has continued to expand

to customers if they are not satisfied. 

and has successfully entered its sixth

Over 600 new Shaw’s brand lines were introduced

New England state, Vermont, with the

in 1996/97 bringing the total to over 5,000. These now

opening of two stores – one in

represent nearly 40% of total sales. New product ranges

Colchester and the other in Berlin

introduced during the year include old-world breads

Corners. A total of eight stores are

which are baked on the premises, Pot O’Soups which

planned for the 1997/98 financial year. 

Shaw’s 100th store opened at North Quincy, Massachusetts in April 1996. 
It is one of 19 stores opened in 1996/97.

Directors

David Bremner
Chairman

Phil Francis
President and 
Chief Executive Officer

Ruth Bramson

Paul Gannon

Pete Gunderson

Verne Powell

Scott Ramsay

Harry Beckner*

Steve DuBrul*

Robin Whitbread*

*Non-Executive 

23

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22-23 Shaw’s
Incarnatus

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Fonts
Notes

CS03 A
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22-23 Shaw’s
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Cyan   Magenta   Yellow   Black   PMS295   PMS021   .Text Black

Shaw’s – serving more new customers in more New England states

Shaw’s serves two million customers each week.

are jointly sourced with Sainsbury’s, a range of luxury

It offers over 30,000 quality, value-for-money products

ice creams called Temptation, and flavoured cream

and the ongoing ‘Every Day Low Prices’ promotion

cheeses which are for use in recipes or as spreads. 

provides further savings. 

Analysis

Sales (incl. taxes)

Operating Profit 

Number of stores

Sales area (’000 sq. ft.)

Full-time associates

1997

$2.49bn

$65.2m

115

3,822

6,868

Part-time associates

13,151

*Results for 1996 are for a 54-week period.

1996*

$2.30bn

$80.0m

96

3,137

5,534

12,232

Shaw’s associates number around 20,000 people.

Over two-thirds are part time and there is an equal

proportion of men and women. One of Shaw’s latest

initiatives, demonstrating its ongoing commitment to

the training and development of associates, is ‘Shaw’s

University’, launched in June 1996. It offers a complete

curriculum to support career and individual development

in all areas of the business. 

All associates are encouraged to participate actively

in improving the quality of life in the communities in

Shaw’s has invested in the latest technology to

which they live and work. A principal focus for this

make shopping more convenient for customers. It was

activity is the United Way Campaign. During 1996/97

the first supermarket in New England to accept the

Shaw’s associates raised over $560,000 for this

national Quest Card for Electronic Benefits Payments

campaign, representing a 14% increase on the amount

and to offer self-checkout.

raised in the previous year.

Key to Shaw’s offer is the strength of the Shaw’s

Nineteen stores opened during 1996/97,

brand which is significantly different from those of its

including the 12 acquired in Connecticut. At the year

competitors. Shaw’s works with growers and

end, Shaw’s had a total of 115 stores in Massachusetts, 

manufacturers to ensure that all Shaw’s products meet

New Hampshire, Maine, Rhode Island and Connecticut.

its high standards and offers a money back guarantee

Since the year end the company has continued to expand

to customers if they are not satisfied. 

and has successfully entered its sixth

Over 600 new Shaw’s brand lines were introduced

New England state, Vermont, with the

in 1996/97 bringing the total to over 5,000. These now

opening of two stores – one in

represent nearly 40% of total sales. New product ranges

Colchester and the other in Berlin

introduced during the year include old-world breads

Corners. A total of eight stores are

which are baked on the premises, Pot O’Soups which

planned for the 1997/98 financial year. 

Shaw’s 100th store opened at North Quincy, Massachusetts in April 1996. 
It is one of 19 stores opened in 1996/97.

Directors

David Bremner
Chairman

Phil Francis
President and 
Chief Executive Officer

Ruth Bramson

Paul Gannon

Pete Gunderson

Verne Powell

Scott Ramsay

Harry Beckner*

Steve DuBrul*

Robin Whitbread*

*Non-Executive 

23

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Notes

CS03 A
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22-23 Shaw’s
Incarnatus

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CS03 A
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22-23 Shaw’s
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Basic
Increase/(decrease) on previous year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

13.42p
21.5%

16.57p
23.5%

20.57p
24.1%

23.11p
12.4%

25.69p
11.2%

28.47p
10.8%

Ten Year Financial Record

RESULTS (£ MILLION)

Group Sales (including VAT & sales taxes)
Increase on previous year

.   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Operating Profit (before profit sharing)
Sainsbury’s Supermarkets 
Savacentre
Homebase
Texas
Shaw’s
Other operating activities

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit sharing
Associates
Interest receivable/(payable)

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Profit before Tax and Property Items

.   .   .   .   .   .   .   .   .   .   .   .   .

Increase/(decrease) on Previous Year
Profit/(loss) on sale of fixed assets

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Profit before Tax

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Increase/(decrease) on Previous Year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

EARNINGS PER SHARE*

1988

5,010

23.9%

1989

5,915

18.1%

276
—
4
—
16
—
———————
296

342
—
9
—
22
—
———————
373

(24)
18
8

298

25.2%
10

308

24.7%

(27)
16
(10)

352

18.1%
23

375

21.8%

Fully diluted (before exceptional costs and  
excluding profit/loss on sale of fixed assets)
Increase/(decrease) on previous year

.   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

DIVIDEND PER SHARE*

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

RETAIL STATISTICS

NUMBER OF OUTLETS AT FINANCIAL YEAR END

Sainsbury’s Supermarkets – 
over 35,000 sq. ft. sales area 
25,000 – 35,000 sq. ft. sales area 
15,000 - 25,000 sq. ft. sales area
under 15,000 sq. ft. sales area

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Sainsbury’s Supermarkets 
Savacentre
Homebase/Texas
Shaw’s

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

TOTAL NUMBER OF STORES

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

SALES AREA (’000 SQ. FT.)
Sainsbury’s Supermarkets 
Savacentre
Homebase/Texas (approx. 80% covered sales area)
Shaw’s

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Total
Net increase on previous year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

12.90p
23.1%

4.15p

14.44p
11.9%

4.99p

1988

1989

9
65
115
94
———————
283
6
38
60
———————
387

5,463
436
1,645
1,592
———————
9,136

12
83
110
87
———————
292
7
48
61
———————
408

5,964
543
1,886
1,693
———————
10,086

New Store Openings
1996/97
Dalston, London
Castle Court, Bristol 
Sittingbourne
Emersons Green, Bristol 
Newton Abbot
Paignton (cid:127) Aberdeen
Clapham, London
Drumchapel, Glasgow
Sale (cid:127) Winnersh
Norwich (cid:127) Stroud
Kirkcaldy (cid:127) March
Melksham (cid:127) Ballymena
Forestside, Belfast

New stores’ sales area 
524,000 sq. ft.

Extensions 1996/97
Castle Boulevard, Nottingham
Chester
Woolton, Liverpool 
Leamington Spa
Gloucester (cid:127) Whitley Bay
Queen’s Road, Norwich
Chase Lane, Ilford
Kidderminster (cid:127) Denton
Burpham
Fosse Park, Leicester
Altrincham (cid:127) St Albans
North Cheam
Nine Elms, London
Cardiff (cid:127) Northampton
Ripley (cid:127) Edinburgh
Kempshott (cid:127) Sheffield

Extensions’ sales area 
144,000 sq. ft.

Planned Store Openings
1997/98 include:
Kenilworth
Reedswood, Walsall 
Blackheath, Halesowen
Burton upon Trent 
Atherleigh Way, Leigh
Wade Street, Halifax 
Merthyr Tydfil
Russell Site, Hitchin 
Brentwood
Glen Road, Leicester 
Walton, Liverpool
Telford
Oswestry 
West Street, Deal

Planned stores’ sales area
502,000 sq. ft.

Planned Extensions
1997/98
Major extensions planned 
at 17 stores

Planned extensions’ sales area 
133,000 sq. ft.

1990

7,257

22.7%

1991

8,201

13.0%

1992††
9,202

12.2%

1993

10,270

11.6%

1994††

11,224

9.3%

1995

12,065

7.5%

1996†††

1997††††

13,499

11.9%

14,312

6.0%

409
17
11
—
34
—
———————
471

516
23
13
—
30
3
———————
585

604
28
15
—
21
(2)
———————
666

716
36
18
—
19
(4)
———————
785

697
38
23
—
31
7
———————
796

784
41
31
—
40
3
———————
899

744
34
36
(10)
51
(1)
———————
854

662
30
45
(29)
41
(4)
———————
745

(34)
1
(18)

420

19.3%
31

451

20.3%

(44)
—
(36)

505

20.2%
13

518

14.9%

(49)
1
13

631

25.0%
(3)

628

21.2%

(59)
—
9

735

16.5%
(2)

733

16.7%

18.15p
25.7%

6.03p

21.74p
19.7%

7.27p

25.34p
16.6%

8.75p

28.07p
10.8%

10.0p

(56)
—
(9)

731

(0.5)%
7

738

0.7%

28.0p
(1.6)%

27.0p
(3.7)%

10.6p

(61)
6
(36)

808

10.5%
1

809

9.6%

29.8p
6.3%

29.0p
7.4%

11.7p

(50)
19
(59)

764

(5.4)%
(4)

760

(37)
19
(76)

651

(14.8)%
8

659

(6.1)%

(13.3)%

26.8p
(10.1)%

22.0p
(17.9)%

27.8p
(4.1)%

12.1p

23.1p
(16.9)%

12.3p

1990

1991

1992

1993

1994

1995

1996

1997

14
102
106
69
———————
291
8
55
66
———————
420

6,434
665
2,107
1,928
———————
11,134

19
117
102
61
———————
299
9
61
70
———————
439

6,951
798
2,317
2,107
———————
12,173

30
129
98
56
———————
313
9
64
73
———————
459

7,632
798
2,406
2,229
———————
13,065

41
136
99
52
———————
328
9
70
79
———————
486

8,303
798
2,609
2,448
———————
14,158

47
146
99
49
———————
341
10
76
87
———————
514

8,827
864
2,810
2,740
———————
15,241

53
155
98
49
———————
355
10
83
87
———————
535

9,338
864
3,082
2,762
———————
16,046

61
166
87
49
———————
363
12
310
96
———————
781

9,767
1,034
11,632(cid:2)
3,137
———————

25,570§

59.1%§

75
169
87
47
———————
378
12
297
115
———————
802

10,387
1,034
11,382
3,822
———————
26,625

4.1%

New Store Opening
1997/98
Leeds

New store’s sales area
85,000 sq. ft.

New Store Openings
1996/97
Newport (cid:127) Plymouth
Warrington (cid:127) Altrincham
Sevenoaks (cid:127) Cannock
Christchurch 
Blackhall, Edinburgh
Watford 

New stores’ sales area 
371,000 sq. ft.

Planned Store Openings
1997/98
Newbury (cid:127) Kirkcaldy
Eastbourne (cid:127) Truro
Dagenham 
Parc Tawe, Swansea
Inverness
Huddersfield (cid:127) Ewell
Gloucester

Planned stores’ sales area
425,000 sq. ft.

New Store Openings
1996/97
North Quincy (cid:127) Cranston 
Riverside (cid:127) Newport
Newington (cid:127) Bangor
Westerly (cid:127) Enfield
Waterbury (cid:127) Orange
Shelton (cid:127) Glastonbury
Stratford (cid:127) Fairfield
Willimantic
West Hartford
Wallingford
Southington (cid:127) Clinton

New stores’ sales area 
678,000 sq. ft.

Planned Store Openings
1997/98
Waterford (cid:127) Colchester
Johnston (cid:127) Berlin Corners
Biddeford (cid:127) Cohasset
East Boston (cid:127) Wakefield

Planned stores’ sales area
329,000 sq. ft.

32.6%

10.4%

10.4%

9.3%

7.3%

8.4%

7.6%

5.3%

New Sainsbury’s Supermarkets openings
Average size of Sainsbury’s Supermarkets (sq. ft.)

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .

16
19,300

20
20,430

22
22,110

20
23,250

21
24,380

23
25,310

23
25,890

20
26,304

10
26,906

18
27,480

AVERAGE SAINSBURY’S SUPERMARKETS SALES (including VAT)**

Per square foot (£ per week)

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

16.30

16.50

17.26

18.17

18.51

18.84

18.60

18.53

18.59

18.69

Share of national trade in predominantly food stores and 
pharmaceutical, medical, cosmetic and toilet goods outlets***

.   .   .   .   .   .   .

9.9%

10.1%

10.8%

11.3%

11.7%

12.3%

12.4%

12.6%

12.5%

12.6%

Adjusted in respect of capitalisation issues in1984 and 1987 and rights issue in 1991. 
Excluding petrol. 

*
**
*** Based on Central Statistical Office/Office for National Statistics (Re-based during 1995) and Sainsbury’s and Savacentre sales, excluding petrol.

Restated.

Property profits for1992 restated to comply with FRS 3.
1994 figures for profits and earnings per share are stated before exceptional costs of £369.5 million but after changes in accounting for depreciation of £38.7 million.

†
††
††† 1996 figures for profits and fully diluted earnings per share are stated before exceptional costs of £48 million.
†††† 1997 figures for profits and fully diluted earnings per share are stated before exceptional costs of £50 million.
§

Excluding Texas – Group total = 17,408,000 sq. ft., net increase 1,362,000 sq. ft., % increase 8.5%.

24

J Sainsbury plc

J Sainsbury plc

25

ES No
Client Stage
Int Stage
Date
Op

119504
Four
Five
22.05.97
deb

Volume
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Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
24-25 10 Year Record
Incarnatus

ES No
Client Stage
Int Stage
Date
Op

119504
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21.05.97
ola

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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
24-25 10 Year Record
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Basic
Increase/(decrease) on previous year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

13.42p
21.5%

16.57p
23.5%

20.57p
24.1%

23.11p
12.4%

25.69p
11.2%

28.47p
10.8%

Ten Year Financial Record

RESULTS (£ MILLION)

Group Sales (including VAT & sales taxes)
Increase on previous year

.   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Operating Profit (before profit sharing)
Sainsbury’s Supermarkets 
Savacentre
Homebase
Texas
Shaw’s
Other operating activities

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit sharing
Associates
Interest receivable/(payable)

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Profit before Tax and Property Items

.   .   .   .   .   .   .   .   .   .   .   .   .

Increase/(decrease) on Previous Year
Profit/(loss) on sale of fixed assets

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Profit before Tax

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Increase/(decrease) on Previous Year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

EARNINGS PER SHARE*

1988

5,010

23.9%

1989

5,915

18.1%

276
—
4
—
16
—
———————
296

342
—
9
—
22
—
———————
373

(24)
18
8

298

25.2%
10

308

24.7%

(27)
16
(10)

352

18.1%
23

375

21.8%

Fully diluted (before exceptional costs and  
excluding profit/loss on sale of fixed assets)
Increase/(decrease) on previous year

.   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

DIVIDEND PER SHARE*

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

RETAIL STATISTICS

NUMBER OF OUTLETS AT FINANCIAL YEAR END

Sainsbury’s Supermarkets – 
over 35,000 sq. ft. sales area 
25,000 – 35,000 sq. ft. sales area 
15,000 - 25,000 sq. ft. sales area
under 15,000 sq. ft. sales area

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Sainsbury’s Supermarkets 
Savacentre
Homebase/Texas
Shaw’s

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

TOTAL NUMBER OF STORES

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

SALES AREA (’000 SQ. FT.)
Sainsbury’s Supermarkets 
Savacentre
Homebase/Texas (approx. 80% covered sales area)
Shaw’s

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Total
Net increase on previous year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

12.90p
23.1%

4.15p

14.44p
11.9%

4.99p

1988

1989

9
65
115
94
———————
283
6
38
60
———————
387

5,463
436
1,645
1,592
———————
9,136

12
83
110
87
———————
292
7
48
61
———————
408

5,964
543
1,886
1,693
———————
10,086

New Store Openings
1996/97
Dalston, London
Castle Court, Bristol 
Sittingbourne
Emersons Green, Bristol 
Newton Abbot
Paignton (cid:127) Aberdeen
Clapham, London
Drumchapel, Glasgow
Sale (cid:127) Winnersh
Norwich (cid:127) Stroud
Kirkcaldy (cid:127) March
Melksham (cid:127) Ballymena
Forestside, Belfast

New stores’ sales area 
524,000 sq. ft.

Extensions 1996/97
Castle Boulevard, Nottingham
Chester
Woolton, Liverpool 
Leamington Spa
Gloucester (cid:127) Whitley Bay
Queen’s Road, Norwich
Chase Lane, Ilford
Kidderminster (cid:127) Denton
Burpham
Fosse Park, Leicester
Altrincham (cid:127) St Albans
North Cheam
Nine Elms, London
Cardiff (cid:127) Northampton
Ripley (cid:127) Edinburgh
Kempshott (cid:127) Sheffield

Extensions’ sales area 
144,000 sq. ft.

Planned Store Openings
1997/98 include:
Kenilworth
Reedswood, Walsall 
Blackheath, Halesowen
Burton upon Trent 
Atherleigh Way, Leigh
Wade Street, Halifax 
Merthyr Tydfil
Russell Site, Hitchin 
Brentwood
Glen Road, Leicester 
Walton, Liverpool
Telford
Oswestry 
West Street, Deal

Planned stores’ sales area
502,000 sq. ft.

Planned Extensions
1997/98
Major extensions planned 
at 17 stores

Planned extensions’ sales area 
133,000 sq. ft.

1990

7,257

22.7%

1991

8,201

13.0%

1992††
9,202

12.2%

1993

10,270

11.6%

1994††

11,224

9.3%

1995

12,065

7.5%

1996†††

1997††††

13,499

11.9%

14,312

6.0%

409
17
11
—
34
—
———————
471

516
23
13
—
30
3
———————
585

604
28
15
—
21
(2)
———————
666

716
36
18
—
19
(4)
———————
785

697
38
23
—
31
7
———————
796

784
41
31
—
40
3
———————
899

744
34
36
(10)
51
(1)
———————
854

662
30
45
(29)
41
(4)
———————
745

(34)
1
(18)

420

19.3%
31

451

20.3%

(44)
—
(36)

505

20.2%
13

518

14.9%

(49)
1
13

631

25.0%
(3)

628

21.2%

(59)
—
9

735

16.5%
(2)

733

16.7%

18.15p
25.7%

6.03p

21.74p
19.7%

7.27p

25.34p
16.6%

8.75p

28.07p
10.8%

10.0p

(56)
—
(9)

731

(0.5)%
7

738

0.7%

28.0p
(1.6)%

27.0p
(3.7)%

10.6p

(61)
6
(36)

808

10.5%
1

809

9.6%

29.8p
6.3%

29.0p
7.4%

11.7p

(50)
19
(59)

764

(5.4)%
(4)

760

(37)
19
(76)

651

(14.8)%
8

659

(6.1)%

(13.3)%

26.8p
(10.1)%

22.0p
(17.9)%

27.8p
(4.1)%

12.1p

23.1p
(16.9)%

12.3p

1990

1991

1992

1993

1994

1995

1996

1997

14
102
106
69
———————
291
8
55
66
———————
420

6,434
665
2,107
1,928
———————
11,134

19
117
102
61
———————
299
9
61
70
———————
439

6,951
798
2,317
2,107
———————
12,173

30
129
98
56
———————
313
9
64
73
———————
459

7,632
798
2,406
2,229
———————
13,065

41
136
99
52
———————
328
9
70
79
———————
486

8,303
798
2,609
2,448
———————
14,158

47
146
99
49
———————
341
10
76
87
———————
514

8,827
864
2,810
2,740
———————
15,241

53
155
98
49
———————
355
10
83
87
———————
535

9,338
864
3,082
2,762
———————
16,046

61
166
87
49
———————
363
12
310
96
———————
781

9,767
1,034
11,632(cid:2)
3,137
———————

25,570§

59.1%§

75
169
87
47
———————
378
12
297
115
———————
802

10,387
1,034
11,382
3,822
———————
26,625

4.1%

New Store Opening
1997/98
Leeds

New store’s sales area
85,000 sq. ft.

New Store Openings
1996/97
Newport (cid:127) Plymouth
Warrington (cid:127) Altrincham
Sevenoaks (cid:127) Cannock
Christchurch 
Blackhall, Edinburgh
Watford 

New stores’ sales area 
371,000 sq. ft.

Planned Store Openings
1997/98
Newbury (cid:127) Kirkcaldy
Eastbourne (cid:127) Truro
Dagenham 
Parc Tawe, Swansea
Inverness
Huddersfield (cid:127) Ewell
Gloucester

Planned stores’ sales area
425,000 sq. ft.

New Store Openings
1996/97
North Quincy (cid:127) Cranston 
Riverside (cid:127) Newport
Newington (cid:127) Bangor
Westerly (cid:127) Enfield
Waterbury (cid:127) Orange
Shelton (cid:127) Glastonbury
Stratford (cid:127) Fairfield
Willimantic
West Hartford
Wallingford
Southington (cid:127) Clinton

New stores’ sales area 
678,000 sq. ft.

Planned Store Openings
1997/98
Waterford (cid:127) Colchester
Johnston (cid:127) Berlin Corners
Biddeford (cid:127) Cohasset
East Boston (cid:127) Wakefield

Planned stores’ sales area
329,000 sq. ft.

32.6%

10.4%

10.4%

9.3%

7.3%

8.4%

7.6%

5.3%

New Sainsbury’s Supermarkets openings
Average size of Sainsbury’s Supermarkets (sq. ft.)

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .

16
19,300

20
20,430

22
22,110

20
23,250

21
24,380

23
25,310

23
25,890

20
26,304

10
26,906

18
27,480

AVERAGE SAINSBURY’S SUPERMARKETS SALES (including VAT)**

Per square foot (£ per week)

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

16.30

16.50

17.26

18.17

18.51

18.84

18.60

18.53

18.59

18.69

Share of national trade in predominantly food stores and 
pharmaceutical, medical, cosmetic and toilet goods outlets***

.   .   .   .   .   .   .

9.9%

10.1%

10.8%

11.3%

11.7%

12.3%

12.4%

12.6%

12.5%

12.6%

Adjusted in respect of capitalisation issues in1984 and 1987 and rights issue in 1991. 
Excluding petrol. 

*
**
*** Based on Central Statistical Office/Office for National Statistics (Re-based during 1995) and Sainsbury’s and Savacentre sales, excluding petrol.

Restated.

Property profits for1992 restated to comply with FRS 3.
1994 figures for profits and earnings per share are stated before exceptional costs of £369.5 million but after changes in accounting for depreciation of £38.7 million.

†
††
††† 1996 figures for profits and fully diluted earnings per share are stated before exceptional costs of £48 million.
†††† 1997 figures for profits and fully diluted earnings per share are stated before exceptional costs of £50 million.
§

Excluding Texas – Group total = 17,408,000 sq. ft., net increase 1,362,000 sq. ft., % increase 8.5%.

24

J Sainsbury plc

J Sainsbury plc

25

ES No
Client Stage
Int Stage
Date
Op

119504
Four
Five
22.05.97
deb

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
24-25 10 Year Record
Incarnatus

ES No
Client Stage
Int Stage
Date
Op

119504
Three
Four
21.05.97
ola

Volume
Path
Name
Fonts
Notes

CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
24-25 10 Year Record
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

(cid:2)
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Group Sales

£ billion

14.3

13.5

12.1

11.2

10.3

1993 1994 1995 1996 1997

Group Operating Profit

£ million

785

796

899

854

745

1993 1994 1995 1996 1997

Employee Numbers
Full-time equivalent (’000s)

102.5

95.5

80.0

82.3

76.5

Financial Review

Sales

Group sales in]creased by •6% to £14.3• billion.

Sales at Sainsbury’s Supermarkets grew by 6% to £10.7 billion. Net new

space (new stores and extensions net of closures) contributed 2.8% points of

this improvement. Sales improved as the year progressed. Sales growth in

existing stores increased from 2.7% in the first half to 3.7% in the second half.

Sales inflation declined from 4% in the first half to less than 3% in the second.

The sales performance of new supermarkets matched or exceeded our

expectations. In particular, the two new stores opened in Northern Ireland

surpassed their pre-opening sales estimates by a significant margin.

Savacentre’s sales grew by •6.8%, a creditable performance considering

that [no] new sales area was added during the year. [However,] clothing sales

were [disappointing].

Sales at the original Homebase stores (i.e. excluding the former Texas

stores acquired in March 1995) improved by •15.7% but the increase in total

sales for the Homebase Group was held to 2.8% as a result of store closures

and the weak performance of the unconverted Texas stores. 

Rebadging of Texas stores as Homebase stores was completed in

December 1996 and since then like-for-like sales, which had been [falling,

have started to in]crease.

Shaw’s recorded •7.5% sales growth in sterling terms. After pro-rating

Shaw’s results for the prior year 54-week period to 52 weeks, the sales increase

was •11.7%, reflecting in particular the impact of the 12 new stores in Connecticut

which were acquired from subsidiaries of Royal Ahold NV during the year.

The Group’s share of the profits of associate companies was £19 million (1996: £19• million). Its share of the

profits of Giant Food Inc. reduced to £17• million (1996: £18• million) as the results for the second half of the year

were impacted by a labour dispute] with distribution staff that has now been [resolved.

Employees’ remuneration and related costs as a percentage of sales for the Sainsbury’s Supermarkets business

increased to •9.5% (1996: •9.1%) as our investment in customer service [continued]. The number of employees in the

Group increased by 11,300 to [166,000], representing 102,500 full-time equivalent employees.

A total of £37 million was set aside for profit sharing for UK retail companies (1996: £50• million). The reduction

in the profit fund in the current year results from the [lower profits in the year. The distribution represents an average

of 4.5•% of wages (1996: •7.1%) for the 115,000 employees eligible to participate in the profit sharing scheme.

Net interest payable for the year was £76• million, an increase of £17• million compared with the previous year.

The increase reflects the higher average borrowings during the year and slightly higher interest rates. Interest

capitalised during the year totalled £10 million (1996: £14• million).

At year end, £50 million was added to the provision for the cost of integrating the Texas stores acquired by

Homebase. This additional provision is to meet the cost of increasing the speed and scope with which Texas stores are

converted to the Homebase format in order to continue to secure [substantial uplifts in sales and operating margins.

Profits from the sale of fixed assets during the year were £8• million (1996: £4• million [loss]). 

Group profit before tax, exceptional costs and profits on the sale of fixed assets was £651• million, a decrease of

•14.8%. After charging the £50• million increase in the Texas [integration provision and crediting profits from the sale of

fixed assets, Group profit before tax was £609• million.

Earnings per share and dividends

Fully diluted earnings per share, before exceptional costs and profits from the sale of fixed assets, were •23.1 pence,

a decrease of •16.9% compared with the previous year. 

Dividends per share of 12.3 pence (an interim of 3.5 pence and a final of 8.8 pence) represent an increase of

0.2 pence or •1.7% compared with the previous year. The total dividend is covered two times by earnings before

Profit]ability 

exceptional costs. 

Group operating profit before profit sharing, exceptional costs and profits

With this level of dividend cover, we expect that, on average, future increases in dividends will be consistent with

on the sale of fixed assets reduced by 12.8% to £745 million. 

The UK food retailing and petrol markets were highly competitive

during the year. Growth in Sainsbury’s Supermarkets’ sales was offset by a

decline in operating margins due largely to lower margins on petrol sales,

higher investment in customer service and the costs of the Reward Card

scheme introduced during the year. 

average earnings per share growth over the medium term.

Operating cash flows

The Group generated cash from operating activities of £1,085• million (1996: £1,012• million) of which 

£525• million was expended on interest (including interest on finance leases), dividends and tax (1996: £561 million).

Dividends and interest received were £17 million (1996: £16• million).

The established Homebase business increased profit by over 25% but

Capital expenditure and store development 

the former Texas business incurred substantial losses in unconverted stores. 

Group capital expenditure was £809• million compared with £759• million in the previous year.

Shaw’s continued to achieve solid progress in profitability in established

The cost of opening new Sainsbury’s supermarkets represented •40% of total capital expenditure and 24% of

1993 1994 1995 1996 1997

markets but incurred significant losses in its new stores in Connecticut as it

the total was spent on refurbishing or extending existing Sainsbury’s supermarkets. During the year we opened 18

sought to strengthen its market position.

Sainsbury’s supermarkets and extended a further •22.

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Group Sales

£ billion

14.3

13.5

12.1

11.2

10.3

1993 1994 1995 1996 1997

Group Operating Profit

£ million

785

796

899

854

745

1993 1994 1995 1996 1997

Employee Numbers
Full-time equivalent (’000s)

102.5

95.5

80.0

82.3

76.5

Financial Review

Sales

Group sales in]creased by •6% to £14.3• billion.

Sales at Sainsbury’s Supermarkets grew by 6% to £10.7 billion. Net new

space (new stores and extensions net of closures) contributed 2.8% points of

this improvement. Sales improved as the year progressed. Sales growth in

existing stores increased from 2.7% in the first half to 3.7% in the second half.

Sales inflation declined from 4% in the first half to less than 3% in the second.

The sales performance of new supermarkets matched or exceeded our

expectations. In particular, the two new stores opened in Northern Ireland

surpassed their pre-opening sales estimates by a significant margin.

Savacentre’s sales grew by •6.8%, a creditable performance considering

that [no] new sales area was added during the year. [However,] clothing sales

were [disappointing].

Sales at the original Homebase stores (i.e. excluding the former Texas

stores acquired in March 1995) improved by •15.7% but the increase in total

sales for the Homebase Group was held to 2.8% as a result of store closures

and the weak performance of the unconverted Texas stores. 

Rebadging of Texas stores as Homebase stores was completed in

December 1996 and since then like-for-like sales, which had been [falling,

have started to in]crease.

Shaw’s recorded •7.5% sales growth in sterling terms. After pro-rating

Shaw’s results for the prior year 54-week period to 52 weeks, the sales increase

was •11.7%, reflecting in particular the impact of the 12 new stores in Connecticut

which were acquired from subsidiaries of Royal Ahold NV during the year.

The Group’s share of the profits of associate companies was £19 million (1996: £19• million). Its share of the

profits of Giant Food Inc. reduced to £17• million (1996: £18• million) as the results for the second half of the year

were impacted by a labour dispute] with distribution staff that has now been [resolved.

Employees’ remuneration and related costs as a percentage of sales for the Sainsbury’s Supermarkets business

increased to •9.5% (1996: •9.1%) as our investment in customer service [continued]. The number of employees in the

Group increased by 11,300 to [166,000], representing 102,500 full-time equivalent employees.

A total of £37 million was set aside for profit sharing for UK retail companies (1996: £50• million). The reduction

in the profit fund in the current year results from the [lower profits in the year. The distribution represents an average

of 4.5•% of wages (1996: •7.1%) for the 115,000 employees eligible to participate in the profit sharing scheme.

Net interest payable for the year was £76• million, an increase of £17• million compared with the previous year.

The increase reflects the higher average borrowings during the year and slightly higher interest rates. Interest

capitalised during the year totalled £10 million (1996: £14• million).

At year end, £50 million was added to the provision for the cost of integrating the Texas stores acquired by

Homebase. This additional provision is to meet the cost of increasing the speed and scope with which Texas stores are

converted to the Homebase format in order to continue to secure [substantial uplifts in sales and operating margins.

Profits from the sale of fixed assets during the year were £8• million (1996: £4• million [loss]). 

Group profit before tax, exceptional costs and profits on the sale of fixed assets was £651• million, a decrease of

•14.8%. After charging the £50• million increase in the Texas [integration provision and crediting profits from the sale of

fixed assets, Group profit before tax was £609• million.

Earnings per share and dividends

Fully diluted earnings per share, before exceptional costs and profits from the sale of fixed assets, were •23.1 pence,

a decrease of •16.9% compared with the previous year. 

Dividends per share of 12.3 pence (an interim of 3.5 pence and a final of 8.8 pence) represent an increase of

0.2 pence or •1.7% compared with the previous year. The total dividend is covered two times by earnings before

Profit]ability 

exceptional costs. 

Group operating profit before profit sharing, exceptional costs and profits

With this level of dividend cover, we expect that, on average, future increases in dividends will be consistent with

on the sale of fixed assets reduced by 12.8% to £745 million. 

The UK food retailing and petrol markets were highly competitive

during the year. Growth in Sainsbury’s Supermarkets’ sales was offset by a

decline in operating margins due largely to lower margins on petrol sales,

higher investment in customer service and the costs of the Reward Card

scheme introduced during the year. 

average earnings per share growth over the medium term.

Operating cash flows

The Group generated cash from operating activities of £1,085• million (1996: £1,012• million) of which 

£525• million was expended on interest (including interest on finance leases), dividends and tax (1996: £561 million).

Dividends and interest received were £17 million (1996: £16• million).

The established Homebase business increased profit by over 25% but

Capital expenditure and store development 

the former Texas business incurred substantial losses in unconverted stores. 

Group capital expenditure was £809• million compared with £759• million in the previous year.

Shaw’s continued to achieve solid progress in profitability in established

The cost of opening new Sainsbury’s supermarkets represented •40% of total capital expenditure and 24% of

1993 1994 1995 1996 1997

markets but incurred significant losses in its new stores in Connecticut as it

the total was spent on refurbishing or extending existing Sainsbury’s supermarkets. During the year we opened 18

sought to strengthen its market position.

Sainsbury’s supermarkets and extended a further •22.

26

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Group Capital Expenditure

Total £809 million

New Sainsbury’s supermarkets (40%)

Other operating companies (32%)

Distribution, Systems and Other (4%)

Existing Sainsbury’s supermarkets (24%)

Group Sales Area
Million square feet

26.6

25.6

15.2

16.0

14.2

Capital expenditure relating to Shaw’s, Homebase and Savacentre

mainly the result of the capital expenditure programme and the acquisitions made during the year.

represented •32% of total capital expenditure. Shaw’s added •19 new

During the year, the Group issued $200 million of 65⁄8% Euro Medium Term Notes maturing in December 1999

supermarkets during the year (including the •12 acquired from subsidiaries of

and $200 million of 61⁄4% Euro Medium Term Notes maturing in March 2002, which together provided more than

Royal Ahold NV) and •nine new Homebase stores were opened.

adequate financing for the $300 million of bonds which matured during the year.

Continuing integration of the former Texas stores with Homebase

Shortly after the year end, the Group issued £200 million of 71⁄4% Euro Medium Term Notes maturing in June

resulted in 38 former Texas stores being converted to the Homebase format

2002 to replace short-term borrowings. 

during the year and 21• being [closed. 

Net interest before interest capitalised is covered •nine times by profit before net interest, exceptional costs and

Overall, the sales area added during the year (net of [closures]) amounted

taxation (1996: •11 times).

to 1,060,000] square feet across the Group. The total sales area in the Group

at year end was 26.6• million square feet.

Net Group capital expenditure in 1997/98 is expected to total

approximately £720• million. We expect to open a further 18• supermarkets 

in the UK in the current year and to extend 17• supermarkets. In addition, 

10 Homebase stores, one Savacentre and eight• new Shaw’s supermarkets are

expected to [open. 

Acquisitions

Treasury management

Treasury policy and significant treasury transactions are reviewed and approved by the Board.

Foreign currency transactions are hedged to reduce or eliminate exchange rate exposure. Forward cover is

used for currency payments to foreign suppliers.

The Group protects its balance sheet from adverse currency translation effects by matching overseas

investments with liabilities of the same currency. Movements on foreign currency borrowings used for balance sheet

hedging purposes are taken directly to reserves. The interest payable on these borrowings serves partially to reduce

the Group’s profit and loss exposure to foreign exchange movements.

The Company acquired the •25% minority interest in Homebase in

All funding requirements are covered by committed borrowing sources of over £1 billion, including a series of

August 1996 from GIB Group SA for a total consideration (including fees and

committed bank facilities with maturities of between two and five years.

costs) of £66• million. 

It is the Group’s policy to provide a degree of protection against interest rate volatility. It is normally planned

An additional investment of £41• million was made in Giant Food Inc. to

that 50% of borrowings should be at fixed rates, although the actual mix may vary with market conditions. In this

acquire two• million non-voting shares. As a result, the Group’s shareholding

context, the Group makes use of interest rate swaps. 

1993 1994 1995 1996 1997

increased from •16.6% to •19.8%.

Capital structure

Currency Composition 
of Group Debt

$1,000 million (£623 million)

£1,054 million

Total Group shareholders’ funds as at 8th March 1997 amounted to 

£3,671• million (1996: £3,534• million). The principal movements for the year

were retained profits of £•177 million, the proceeds from share allotments of

£25• million less goodwill write-offs of £66• million. The goodwill write-off

relating to the acquisition of the minority interest in Homebase was 

£54• million, £21• million related to the acquisition of shares in Giant Food Inc.

and £•9 million was [netted off] against these amounts representing the sum

received from Ladbroke PLC following arbitration on the purchase price of

Home Charm Group PLC.

Group net debt of £1,436• million (1996: £1,217• million) gives balance

sheet gearing (net debt as a percentage of shareholders’ funds) of •39.1% as

at 8th March 1997 (1996: 34.4•%) which is below the Group’s target

maximum for balance sheet gearing of •40%. The increase in net debt is

As at 8th March 1997, the overall fixed rate component of gross borrowings was •27%. Following the issue of

£200 million 71⁄4% Euro Medium Term Notes shortly after the year end, the overall fixed rate component of gross

borrowings rose to around 40%.

The senior long-term debt of J Sainsbury plc is rated ‘A+’ by Standard & Poor’s Ratings Group, ‘AA3’ by

Moody’s Investors Services and ‘AA-’ by IBCA. Short-term indebtedness is rated ‘A-1’ by Standard & Poor’s Ratings

Group, ‘P-1’ by Moody’s Investors Services and ‘A1+’ by IBCA.

28

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Group Capital Expenditure

Total £809 million

New Sainsbury’s supermarkets (40%)

Other operating companies (32%)

Distribution, Systems and Other (4%)

Existing Sainsbury’s supermarkets (24%)

Group Sales Area
Million square feet

26.6

25.6

15.2

16.0

14.2

Capital expenditure relating to Shaw’s, Homebase and Savacentre

mainly the result of the capital expenditure programme and the acquisitions made during the year.

represented •32% of total capital expenditure. Shaw’s added •19 new

During the year, the Group issued $200 million of 65⁄8% Euro Medium Term Notes maturing in December 1999

supermarkets during the year (including the •12 acquired from subsidiaries of

and $200 million of 61⁄4% Euro Medium Term Notes maturing in March 2002, which together provided more than

Royal Ahold NV) and •nine new Homebase stores were opened.

adequate financing for the $300 million of bonds which matured during the year.

Continuing integration of the former Texas stores with Homebase

Shortly after the year end, the Group issued £200 million of 71⁄4% Euro Medium Term Notes maturing in June

resulted in 38 former Texas stores being converted to the Homebase format

2002 to replace short-term borrowings. 

during the year and 21• being [closed. 

Net interest before interest capitalised is covered •nine times by profit before net interest, exceptional costs and

Overall, the sales area added during the year (net of [closures]) amounted

taxation (1996: •11 times).

to 1,060,000] square feet across the Group. The total sales area in the Group

at year end was 26.6• million square feet.

Net Group capital expenditure in 1997/98 is expected to total

approximately £720• million. We expect to open a further 18• supermarkets 

in the UK in the current year and to extend 17• supermarkets. In addition, 

10 Homebase stores, one Savacentre and eight• new Shaw’s supermarkets are

expected to [open. 

Acquisitions

Treasury management

Treasury policy and significant treasury transactions are reviewed and approved by the Board.

Foreign currency transactions are hedged to reduce or eliminate exchange rate exposure. Forward cover is

used for currency payments to foreign suppliers.

The Group protects its balance sheet from adverse currency translation effects by matching overseas

investments with liabilities of the same currency. Movements on foreign currency borrowings used for balance sheet

hedging purposes are taken directly to reserves. The interest payable on these borrowings serves partially to reduce

the Group’s profit and loss exposure to foreign exchange movements.

The Company acquired the •25% minority interest in Homebase in

All funding requirements are covered by committed borrowing sources of over £1 billion, including a series of

August 1996 from GIB Group SA for a total consideration (including fees and

committed bank facilities with maturities of between two and five years.

costs) of £66• million. 

It is the Group’s policy to provide a degree of protection against interest rate volatility. It is normally planned

An additional investment of £41• million was made in Giant Food Inc. to

that 50% of borrowings should be at fixed rates, although the actual mix may vary with market conditions. In this

acquire two• million non-voting shares. As a result, the Group’s shareholding

context, the Group makes use of interest rate swaps. 

1993 1994 1995 1996 1997

increased from •16.6% to •19.8%.

Capital structure

Currency Composition 
of Group Debt

$1,000 million (£623 million)

£1,054 million

Total Group shareholders’ funds as at 8th March 1997 amounted to 

£3,671• million (1996: £3,534• million). The principal movements for the year

were retained profits of £•177 million, the proceeds from share allotments of

£25• million less goodwill write-offs of £66• million. The goodwill write-off

relating to the acquisition of the minority interest in Homebase was 

£54• million, £21• million related to the acquisition of shares in Giant Food Inc.

and £•9 million was [netted off] against these amounts representing the sum

received from Ladbroke PLC following arbitration on the purchase price of

Home Charm Group PLC.

Group net debt of £1,436• million (1996: £1,217• million) gives balance

sheet gearing (net debt as a percentage of shareholders’ funds) of •39.1% as

at 8th March 1997 (1996: 34.4•%) which is below the Group’s target

maximum for balance sheet gearing of •40%. The increase in net debt is

As at 8th March 1997, the overall fixed rate component of gross borrowings was •27%. Following the issue of

£200 million 71⁄4% Euro Medium Term Notes shortly after the year end, the overall fixed rate component of gross

borrowings rose to around 40%.

The senior long-term debt of J Sainsbury plc is rated ‘A+’ by Standard & Poor’s Ratings Group, ‘AA3’ by

Moody’s Investors Services and ‘AA-’ by IBCA. Short-term indebtedness is rated ‘A-1’ by Standard & Poor’s Ratings

Group, ‘P-1’ by Moody’s Investors Services and ‘A1+’ by IBCA.

28

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Summary Financial Statement

Group Balance Sheet
8th March 1997

The Directors present the Summary Financial Statement of the Group for the 52 weeks ended 8th March

1997. The Summary Financial Statement does not contain sufficient information to allow for a full understanding of

the results of the Group and the state of affairs of the Company or of the Group. For further information the separate

Fixed Assets 

publication, entitled Annual Accounts 1997, containing the Directors’ Report, the Accounts and the Auditors’ Report

on those Accounts (which is unqualified) should be consulted.

Tangible assets 

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Investments 

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Corporate Governance

The Group has complied throughout the period under review with all the provisions of the Code of Best Practice

contained in the Cadbury Committee’s Report and as laid down in the Listing Rules of the London Stock Exchange.

Current Assets 

1997

£m

5,893

148

1996

£m

5,458

117

———————————— ————————————

6,041

5,575

———————————— ————————————

Group Performance

A review of the performance of the Company and its subsidiaries during the period and at the period end, 

with an indication of likely developments in the Group, is contained in the Chairman’s Statement on pages 2 and 3,

and in the Review on pages 6 to 23. A review of the Group’s financial performance and dividends payable is given 

Stocks 

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Debtors

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Investments

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Cash and liquid funds

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

744

253

7

241

761

204

5

209

on pages 26 to 29.

The Board

The Board of Directors meets regularly and is responsible for the effective management of the business. During

the year a number of changes were made to Directors’ responsibilities. Dino Adriano has taken over from Tom Vyner

as Chief Executive of the UK food retailing businesses. David Bremner was appointed as Chief Executive of

Homebase and US businesses on 19th August 1996. Tom Vyner, as Deputy Chairman, will concentrate on

international buying until he retires in January 1998. Sir Terence Heiser GCB is the nominated senior Non-Executive

Director. All Directors have access to the advice and services of the Company Secretary. In addition, there is an agreed

procedure for Directors to take independent professional advice, if necessary, at the Company’s expense. The Chairman

and the Non-Executive Directors do not have service contracts. The service contracts for Executive Directors have

either less than 24 months to run or are on a rolling 24-month basis.

Board Committees

The Company’s Remuneration Committee is responsible for advising on Executive Directors’ pay and benefits. 

The full report of the Committee is included in the Annual Accounts. The Nomination Committee advises the Board

on the appointment of Executive Directors. The Audit Committee receives reports regularly from the Group Internal

Audit Department and ensures that an objective and professional relationship is maintained between the Board and

the external auditors. The membership of these Committees is shown on pages 4 and 5 of this Review. In February

1997 a subsidiary company was established, Sainsbury’s Supermarkets Ltd, to undertake the major trading activities

of the UK supermarket business and began operating on 9th March 1997. The Directors of the new company are

shown on pages 4 and 5.

Directors

The Directors are shown on pages 4 and 5. All Directors shown held office throughout the period except 

Sir David Scholey CBE who was appointed as a Non-Executive Director on 18th July 1996 and David Bremner who

was appointed on 19th August 1996. David Quarmby retired on 26th April 1996. Colin Harvey retired from the

Board on 8th April 1997. Mr Harvey will continue as Managing Director of Savacentre until June 1999. The

emoluments of the Executive Directors are determined by the Board on the advice of the Remuneration Committee.

The aggregate emoluments of the Directors of the Company were £5.0 million (1996: £4.2 million).

Creditors: due within one year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

———————————— ————————————

1,245

(2,804)

1,179

(2,519)

———————————— ————————————

Net Current Liabilities

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(1,559)

(1,340)

Total Assets less Current Liabilities .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

4,482

4,235

———————————— ————————————

Creditors: due after one year

Convertible Capital Bonds

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Other

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Provisions for Liabilities and Charges

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Minority Equity Interest

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Capital and Reserves 

Called up share capital

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Share premium account

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Revaluation reserve

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit and loss account

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(156)

(595)

(55)

(5)

(156)

(480)

(54)

(11)

———————————— ————————————

3,671

3,534

————————————— ————————————

460

1,097

33

2,081

458

1,074

43

1,959

———————————— ————————————

Equity Shareholders’ Funds

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

3,671

3,534

————————————— ————————————

The Summary Financial Statement on pages 30 to 32 was approved by the Board of Directors on 6th May 1997, and is signed on 
its behalf by David Sainsbury, Chairman.

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Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Summary Financial Statement

Group Balance Sheet
8th March 1997

The Directors present the Summary Financial Statement of the Group for the 52 weeks ended 8th March

1997. The Summary Financial Statement does not contain sufficient information to allow for a full understanding of

the results of the Group and the state of affairs of the Company or of the Group. For further information the separate

Fixed Assets 

publication, entitled Annual Accounts 1997, containing the Directors’ Report, the Accounts and the Auditors’ Report

on those Accounts (which is unqualified) should be consulted.

Tangible assets 

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Investments 

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Corporate Governance

The Group has complied throughout the period under review with all the provisions of the Code of Best Practice

contained in the Cadbury Committee’s Report and as laid down in the Listing Rules of the London Stock Exchange.

Current Assets 

1997

£m

5,893

148

1996

£m

5,458

117

———————————— ————————————

6,041

5,575

———————————— ————————————

Group Performance

A review of the performance of the Company and its subsidiaries during the period and at the period end, 

with an indication of likely developments in the Group, is contained in the Chairman’s Statement on pages 2 and 3,

and in the Review on pages 6 to 23. A review of the Group’s financial performance and dividends payable is given 

Stocks 

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Debtors

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Investments

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Cash and liquid funds

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

744

253

7

241

761

204

5

209

on pages 26 to 29.

The Board

The Board of Directors meets regularly and is responsible for the effective management of the business. During

the year a number of changes were made to Directors’ responsibilities. Dino Adriano has taken over from Tom Vyner

as Chief Executive of the UK food retailing businesses. David Bremner was appointed as Chief Executive of

Homebase and US businesses on 19th August 1996. Tom Vyner, as Deputy Chairman, will concentrate on

international buying until he retires in January 1998. Sir Terence Heiser GCB is the nominated senior Non-Executive

Director. All Directors have access to the advice and services of the Company Secretary. In addition, there is an agreed

procedure for Directors to take independent professional advice, if necessary, at the Company’s expense. The Chairman

and the Non-Executive Directors do not have service contracts. The service contracts for Executive Directors have

either less than 24 months to run or are on a rolling 24-month basis.

Board Committees

The Company’s Remuneration Committee is responsible for advising on Executive Directors’ pay and benefits. 

The full report of the Committee is included in the Annual Accounts. The Nomination Committee advises the Board

on the appointment of Executive Directors. The Audit Committee receives reports regularly from the Group Internal

Audit Department and ensures that an objective and professional relationship is maintained between the Board and

the external auditors. The membership of these Committees is shown on pages 4 and 5 of this Review. In February

1997 a subsidiary company was established, Sainsbury’s Supermarkets Ltd, to undertake the major trading activities

of the UK supermarket business and began operating on 9th March 1997. The Directors of the new company are

shown on pages 4 and 5.

Directors

The Directors are shown on pages 4 and 5. All Directors shown held office throughout the period except 

Sir David Scholey CBE who was appointed as a Non-Executive Director on 18th July 1996 and David Bremner who

was appointed on 19th August 1996. David Quarmby retired on 26th April 1996. Colin Harvey retired from the

Board on 8th April 1997. Mr Harvey will continue as Managing Director of Savacentre until June 1999. The

emoluments of the Executive Directors are determined by the Board on the advice of the Remuneration Committee.

The aggregate emoluments of the Directors of the Company were £5.0 million (1996: £4.2 million).

Creditors: due within one year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

———————————— ————————————

1,245

(2,804)

1,179

(2,519)

———————————— ————————————

Net Current Liabilities

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(1,559)

(1,340)

Total Assets less Current Liabilities .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

4,482

4,235

———————————— ————————————

Creditors: due after one year

Convertible Capital Bonds

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Other

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Provisions for Liabilities and Charges

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Minority Equity Interest

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Capital and Reserves 

Called up share capital

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Share premium account

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Revaluation reserve

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit and loss account

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(156)

(595)

(55)

(5)

(156)

(480)

(54)

(11)

———————————— ————————————

3,671

3,534

————————————— ————————————

460

1,097

33

2,081

458

1,074

43

1,959

———————————— ————————————

Equity Shareholders’ Funds

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

3,671

3,534

————————————— ————————————

The Summary Financial Statement on pages 30 to 32 was approved by the Board of Directors on 6th May 1997, and is signed on 
its behalf by David Sainsbury, Chairman.

30

J Sainsbury plc

J Sainsbury plc

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Int Stage
Date
Op

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Volume
Path
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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
30-31 Summary Financial
Incarnatus

ES No
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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
30-31 Summary Financial
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Group Profit and Loss Account

for the 52 weeks to 8th March 1997

Total
1997
£m

Total
1996
£m

Group Sales including VAT & sales taxes

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

14,312

13,499

VAT & sales taxes

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Sales excluding VAT & sales taxes

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Cost of sales
Exceptional cost of sales – Texas Homecare integration costs

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Gross Profit

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Administrative expenses

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Operating Profit before profit sharing 

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit sharing

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Operating Profit

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Associated undertakings – share of profit
Profit/(loss) on sale of fixed assets

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit on Ordinary Activities before Interest

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Net interest payable

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit on Ordinary Activities before Tax

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Tax on profit on ordinary activities

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit on Ordinary Activities after Tax

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Minority equity interest

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit for the Financial Year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Dividends

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Retained Profit

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .  .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

917

872
———————————— ————————————
12,627

13,395

12,363
50

11,521
48
———————————— ————————————
1,058

982

287

252
———————————— ————————————
806

695

37

50
———————————— ————————————
756

658

19
8

19
(4)
———————————— ————————————
771

685

76

59
———————————— ————————————
712

609

208

234
———————————— ————————————
478

401

2

10
———————————— ————————————
488

403

226

222
———————————— ————————————
266
————————————— ————————————

177

Statement by the Auditors 
to the Shareholders of J Sainsbury plc on the 
Summary Financial Statement

We have examined the Summary Financial Statement set out on pages 30 to 32.

Respective Responsibilities of Directors and Auditors

The Summary Financial Statement is the responsibility of the Directors. Our responsibility is to report our

opinion on its preparation and consistency with the Annual Accounts and Directors’ Report.

Basis of Opinion

We conducted our work in accordance with Auditing Guideline ‘The auditors’ statement on the summary

financial statement’ adopted by the Auditing Practices Board.

Opinion

In our opinion the Summary Financial Statement is consistent with the Annual Accounts and the Directors’

Report of J Sainsbury plc for the 52 weeks ended 8th March 1997 and complies with the requirements of 

Section 251 of the Companies Act 1985, and the regulations made thereunder.

Coopers & Lybrand

Chartered Accountants and Registered Auditors

London

6th May 1997

Earnings Per Share

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

22.0p

26.8p

Annual Review and Summary Financial Statement

Exceptional cost of sales
(Profit)/loss on sale of fixed assets

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Earnings Per Share before exceptional cost of sales 
and profit/loss on sale of fixed assets

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Fully Diluted Earnings Per Share
Fully Diluted Earnings Per Share before exceptional cost of sales 
and profit/loss on sale of fixed assets

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

1.8p
(0.4p)

1.3p
0.2p
———————————— ————————————

23.4p

28.3p
————————————— ————————————

21.8p

26.4p

23.1p

27.8p

This Annual Review and the Summary Financial Statement on pages 30 to 32 do not contain sufficient information

to allow for a full understanding of the results of the Group and state of affairs of the Company or of the Group. 

The Directors’ Report, the Accounts and Auditors’ Report on those Accounts are contained in a separate publication

entitled Annual Accounts 1997, which, together with this publication, comprise the full Annual Report and Accounts

of J Sainsbury plc for 1997. Copies may be obtained, free of charge, by telephoning

Shareholders wishing to receive the Annual Accounts as well as the Annual Review and Summary Financial

Statement in future years should write to the Registrar at the address on the inside back cover.

Freephone 0800 387504

32

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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
32-33 Summary Financial
Incarnatus

ES No
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119504
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CS03 A
Sainsburys > 119504 R&A Review 97 > .Documents
32-33 Summary Financial
Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Group Profit and Loss Account

for the 52 weeks to 8th March 1997

Total
1997
£m

Total
1996
£m

Group Sales including VAT & sales taxes

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

14,312

13,499

VAT & sales taxes

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Sales excluding VAT & sales taxes

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Cost of sales
Exceptional cost of sales – Texas Homecare integration costs

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Gross Profit

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Administrative expenses

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Operating Profit before profit sharing 

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit sharing

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Operating Profit

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Associated undertakings – share of profit
Profit/(loss) on sale of fixed assets

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit on Ordinary Activities before Interest

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Net interest payable

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit on Ordinary Activities before Tax

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Tax on profit on ordinary activities

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit on Ordinary Activities after Tax

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Minority equity interest

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit for the Financial Year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Dividends

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Retained Profit

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .  .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

917

872
———————————— ————————————
12,627

13,395

12,363
50

11,521
48
———————————— ————————————
1,058

982

287

252
———————————— ————————————
806

695

37

50
———————————— ————————————
756

658

19
8

19
(4)
———————————— ————————————
771

685

76

59
———————————— ————————————
712

609

208

234
———————————— ————————————
478

401

2

10
———————————— ————————————
488

403

226

222
———————————— ————————————
266
————————————— ————————————

177

Statement by the Auditors 
to the Shareholders of J Sainsbury plc on the 
Summary Financial Statement

We have examined the Summary Financial Statement set out on pages 30 to 32.

Respective Responsibilities of Directors and Auditors

The Summary Financial Statement is the responsibility of the Directors. Our responsibility is to report our

opinion on its preparation and consistency with the Annual Accounts and Directors’ Report.

Basis of Opinion

We conducted our work in accordance with Auditing Guideline ‘The auditors’ statement on the summary

financial statement’ adopted by the Auditing Practices Board.

Opinion

In our opinion the Summary Financial Statement is consistent with the Annual Accounts and the Directors’

Report of J Sainsbury plc for the 52 weeks ended 8th March 1997 and complies with the requirements of 

Section 251 of the Companies Act 1985, and the regulations made thereunder.

Coopers & Lybrand

Chartered Accountants and Registered Auditors

London

6th May 1997

Earnings Per Share

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

22.0p

26.8p

Annual Review and Summary Financial Statement

Exceptional cost of sales
(Profit)/loss on sale of fixed assets

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Earnings Per Share before exceptional cost of sales 
and profit/loss on sale of fixed assets

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Fully Diluted Earnings Per Share
Fully Diluted Earnings Per Share before exceptional cost of sales 
and profit/loss on sale of fixed assets

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

1.8p
(0.4p)

1.3p
0.2p
———————————— ————————————

23.4p

28.3p
————————————— ————————————

21.8p

26.4p

23.1p

27.8p

This Annual Review and the Summary Financial Statement on pages 30 to 32 do not contain sufficient information

to allow for a full understanding of the results of the Group and state of affairs of the Company or of the Group. 

The Directors’ Report, the Accounts and Auditors’ Report on those Accounts are contained in a separate publication

entitled Annual Accounts 1997, which, together with this publication, comprise the full Annual Report and Accounts

of J Sainsbury plc for 1997. Copies may be obtained, free of charge, by telephoning

Shareholders wishing to receive the Annual Accounts as well as the Annual Review and Summary Financial

Statement in future years should write to the Registrar at the address on the inside back cover.

Freephone 0800 387504

32

J Sainsbury plc

J Sainsbury plc

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Incarnatus

OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Shareholders % 1997

Services, 111 Wall Street, New York, NY 10043.

Shareholders’ Interests at 
8th March 1997
Number of Shareholders: 113,882 (1996: 111,012)

Range of Shareholdings

Shareholders %

Shares %

1997

1996

1997

1996

500 and under

43.04 39.38

501 to 1,000

19.88 20.55

1,001 to 10,000

34.12 36.99

10,001 to 100,000

2.21

2.31

0.48

0.94

5.52

3.69

0.45

0.95

5.73

3.78

100,001 to 1,000,000 0.56

0.58 11.78 11.83

over 1,000,000

0.19

0.19 77.69 77.26

100.00 100.00 100.00 100.00

Insurance companies 0.09

Investment trusts 0.17

Pension funds 0.03

Other corporate bodies 1.75

Banks and nominee companies 8.88

Individuals and other shareholders 89.08

Shares % 1997

Insurance companies 1.16

Investment trusts 0.22

Pension funds 1.67

Other corporate bodies 3.11

Banks and nominee companies 46.86

Individuals and other shareholders 46.98

At the year end, the Trustees of the J Sainsbury Profit Sharing
Scheme Share Trust held 11.9 million shares (1996: 19.5
million) on behalf of 39,854 participants (1996: 43,472).

Changes in the law reducing the period shares are held in trust
from five to three years was the major reason for the fall in the
number of shares held in Trust and the fall in the number of
participants in the Scheme. The Trustees’ holding is included in
‘other shareholders’.

34

J Sainsbury plc

Investor Information

Annual General Meeting

The Annual General Meeting will be held at 12 noon on

Wednesday 9th July 1997 at The Queen Elizabeth II Conference Centre,

Broad Sanctuary, Westminster, London SW1P 3EE. The Notice of the

Meeting and the proxy card accompany this Annual Review.

to be established within CREST, will be included with the dividend

documents sent to shareholders at the end of July.

Tax Information – Capital Gains Tax

For Capital Gains Tax purposes, the market value of ordinary

shares on 31st March 1982 is 69.375p.

American Depository Receipts (ADRs)

Share Price

In the US, the Company’s ordinary shares are traded in the 

over-the-counter markets (‘OTC’) in the form of American Depository

Shares, evidenced by ADRs, and trade under the symbol JSNSY. Each

American Depository Share represents four ordinary shares. Citibank

is the Authorised Depository Bank for the Sainsbury ADR Programme.

All enquiries regarding ADR holder accounts and payment of

dividends should be addressed to: Citibank, N.A., ADR Shareholder

Share Dividend Alternative

The Company is again offering the option of a share dividend

alternative to holders of ordinary shares. An ‘Evergreen’ system is

now in operation so shareholders who have already completed a

mandate and wish to receive shares for the final dividend 1996/97

need take no action.

Low Cost Share Dealing Service

The Company offers a share dealing service for J Sainsbury plc

ordinary shares through The Share Centre Ltd., in conjunction with

SBC Warburg. Dealing commission on both purchases and sales of 

J Sainsbury plc ordinary shares is 1% with no minimum charge,

although purchases are subject to a minimum investment of £500.

For further information, please write to: J Sainsbury Share Dealing

Service, The Share Centre Ltd., PO Box 1000, Tring, Hertfordshire

HP23 4JR. The publication of the above information relating to the low

cost dealing service has been approved, for the purposes of Section 57

of the Financial Services Act 1986, by The Share Centre Ltd., a member

of the Securities and Futures Authority.

Personal Equity Plans

On the Company’s behalf, a Single Company PEP and a General

PEP are operated by The Royal Bank of Scotland. For further

information contact The Royal Bank of Scotland plc, PEP Unit,

Registrar’s Department, PO Box 1840, 8 Bankhead Crossway North, 

Edinburgh EH11 4BS. Telephone: 0131 523 6101.

Nominee Service

The middle market price of the Company’s ordinary shares on 

8th March 1997 was 316.5p per share and the range during the 

year was 407p to 308p. The Company’s market capitalisation on 

8th March 1997 was £5,823.7 million in comparison with 

£6,942 million on 9th March 1996.

Further Information

Below are some useful telephone numbers:

Information about the AGM, shareholdings, dividends and changes to

personal details:

The Royal Bank of Scotland .   .   .   .   .   .   .   .   .   .   .   .  0117 930 6600

Information about low cost dealing facilities:

The Share Centre .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .  01442 890844

An audio tape of this Annual Review can be 

obtained by calling .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .  01435 866102

The Company’s Environment Report is available 

on the Internet and by calling

.   .   .   .   .   .   .   .   .   . 

0800 387504

For general enquiries about Sainsbury’s Bank 

please call

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 

0500 405060

For any other enquiries please contact 

our Customer Services

.   .   .   .   .   .   .   .   .   .   .   .   . 

0800 636262

Information about the Company 

Key dates in respect of the Share 
Dividend Alternative: Final 1996/97

Calculation period for
share dividend price

19th May to 
23rd May 1997

Ordinary shares record date

23rd May 1997

Last date for receipt by 
Registrars of mandates/ 
revocations (Return Date)

Share Dividend Alternative 
certificates posted

First date of dealing 
in new shares

17th June 1997

24th July 1997

25th July 1997

Shares have been issued 
in respect of share dividends 
at the following prices:

Dividend

Interim
Payment Date

Issue
Price

Final Payment
Date

Issue
Price

1992/93 18th January 

1993

483.4p

1993/94 17th January

1994

406.8p

1994/95 18th January 

1995

418.2p

1995/96 17th January 

1996

391.2p

1996/97 15th January 

1997

349.8p

30th July
1993

29th July
1994

28th July
1995

26th July
1996

476.6p

389.0p

436.4p

380.4p

The cash equivalent of the new shares
issued during the year is as follows:

Dividend

Cash Equivalent Gross Income for 
UK Tax Purposes*

Final 1995/96
(paid 26th July 1996)

380.4p

475.5p

Interim 1996/97 
(paid 15th January 1997) 349.8p

437.3p

*Cash equivalent grossed up for tax at 20%

Information on how to obtain details about the Nominee Service,

may be found on the Internet at

.   .   . 

http://www.sainsburys.co.uk

J Sainsbury plc

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OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Shareholders % 1997

Services, 111 Wall Street, New York, NY 10043.

Shareholders’ Interests at 
8th March 1997
Number of Shareholders: 113,882 (1996: 111,012)

Range of Shareholdings

Shareholders %

Shares %

1997

1996

1997

1996

500 and under

43.04 39.38

501 to 1,000

19.88 20.55

1,001 to 10,000

34.12 36.99

10,001 to 100,000

2.21

2.31

0.48

0.94

5.52

3.69

0.45

0.95

5.73

3.78

100,001 to 1,000,000 0.56

0.58 11.78 11.83

over 1,000,000

0.19

0.19 77.69 77.26

100.00 100.00 100.00 100.00

Insurance companies 0.09

Investment trusts 0.17

Pension funds 0.03

Other corporate bodies 1.75

Banks and nominee companies 8.88

Individuals and other shareholders 89.08

Shares % 1997

Insurance companies 1.16

Investment trusts 0.22

Pension funds 1.67

Other corporate bodies 3.11

Banks and nominee companies 46.86

Individuals and other shareholders 46.98

At the year end, the Trustees of the J Sainsbury Profit Sharing
Scheme Share Trust held 11.9 million shares (1996: 19.5
million) on behalf of 39,854 participants (1996: 43,472).

Changes in the law reducing the period shares are held in trust
from five to three years was the major reason for the fall in the
number of shares held in Trust and the fall in the number of
participants in the Scheme. The Trustees’ holding is included in
‘other shareholders’.

34

J Sainsbury plc

Investor Information

Annual General Meeting

The Annual General Meeting will be held at 12 noon on

Wednesday 9th July 1997 at The Queen Elizabeth II Conference Centre,

Broad Sanctuary, Westminster, London SW1P 3EE. The Notice of the

Meeting and the proxy card accompany this Annual Review.

to be established within CREST, will be included with the dividend

documents sent to shareholders at the end of July.

Tax Information – Capital Gains Tax

For Capital Gains Tax purposes, the market value of ordinary

shares on 31st March 1982 is 69.375p.

American Depository Receipts (ADRs)

Share Price

In the US, the Company’s ordinary shares are traded in the 

over-the-counter markets (‘OTC’) in the form of American Depository

Shares, evidenced by ADRs, and trade under the symbol JSNSY. Each

American Depository Share represents four ordinary shares. Citibank

is the Authorised Depository Bank for the Sainsbury ADR Programme.

All enquiries regarding ADR holder accounts and payment of

dividends should be addressed to: Citibank, N.A., ADR Shareholder

Share Dividend Alternative

The Company is again offering the option of a share dividend

alternative to holders of ordinary shares. An ‘Evergreen’ system is

now in operation so shareholders who have already completed a

mandate and wish to receive shares for the final dividend 1996/97

need take no action.

Low Cost Share Dealing Service

The Company offers a share dealing service for J Sainsbury plc

ordinary shares through The Share Centre Ltd., in conjunction with

SBC Warburg. Dealing commission on both purchases and sales of 

J Sainsbury plc ordinary shares is 1% with no minimum charge,

although purchases are subject to a minimum investment of £500.

For further information, please write to: J Sainsbury Share Dealing

Service, The Share Centre Ltd., PO Box 1000, Tring, Hertfordshire

HP23 4JR. The publication of the above information relating to the low

cost dealing service has been approved, for the purposes of Section 57

of the Financial Services Act 1986, by The Share Centre Ltd., a member

of the Securities and Futures Authority.

Personal Equity Plans

On the Company’s behalf, a Single Company PEP and a General

PEP are operated by The Royal Bank of Scotland. For further

information contact The Royal Bank of Scotland plc, PEP Unit,

Registrar’s Department, PO Box 1840, 8 Bankhead Crossway North, 

Edinburgh EH11 4BS. Telephone: 0131 523 6101.

Nominee Service

The middle market price of the Company’s ordinary shares on 

8th March 1997 was 316.5p per share and the range during the 

year was 407p to 308p. The Company’s market capitalisation on 

8th March 1997 was £5,823.7 million in comparison with 

£6,942 million on 9th March 1996.

Further Information

Below are some useful telephone numbers:

Information about the AGM, shareholdings, dividends and changes to

personal details:

The Royal Bank of Scotland .   .   .   .   .   .   .   .   .   .   .   .  0117 930 6600

Information about low cost dealing facilities:

The Share Centre .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .  01442 890844

An audio tape of this Annual Review can be 

obtained by calling .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .  01435 866102

The Company’s Environment Report is available 

on the Internet and by calling

.   .   .   .   .   .   .   .   .   . 

0800 387504

For general enquiries about Sainsbury’s Bank 

please call

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 

0500 405060

For any other enquiries please contact 

our Customer Services

.   .   .   .   .   .   .   .   .   .   .   .   . 

0800 636262

Information about the Company 

Key dates in respect of the Share 
Dividend Alternative: Final 1996/97

Calculation period for
share dividend price

19th May to 
23rd May 1997

Ordinary shares record date

23rd May 1997

Last date for receipt by 
Registrars of mandates/ 
revocations (Return Date)

Share Dividend Alternative 
certificates posted

First date of dealing 
in new shares

17th June 1997

24th July 1997

25th July 1997

Shares have been issued 
in respect of share dividends 
at the following prices:

Dividend

Interim
Payment Date

Issue
Price

Final Payment
Date

Issue
Price

1992/93 18th January 

1993

483.4p

1993/94 17th January

1994

406.8p

1994/95 18th January 

1995

418.2p

1995/96 17th January 

1996

391.2p

1996/97 15th January 

1997

349.8p

30th July
1993

29th July
1994

28th July
1995

26th July
1996

476.6p

389.0p

436.4p

380.4p

The cash equivalent of the new shares
issued during the year is as follows:

Dividend

Cash Equivalent Gross Income for 
UK Tax Purposes*

Final 1995/96
(paid 26th July 1996)

380.4p

475.5p

Interim 1996/97 
(paid 15th January 1997) 349.8p

437.3p

*Cash equivalent grossed up for tax at 20%

Information on how to obtain details about the Nominee Service,

may be found on the Internet at

.   .   . 

http://www.sainsburys.co.uk

J Sainsbury plc

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OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

Financial Calendar 1997/98

Dividend and Interest Payments

Ordinary Dividend

Final

.   .   .   .   .   .   .   .   .   .   .

payable 25th July 1997

Interim .   .   .   .   .   .   .   .   .   .   .

payable January 1998

8% Irredeemable Unsecured Loan Stock .   .   .   .   .   .   .  1st March

.   .   .   .   .   .   .   .   .   .   .   .   .   . 1st September

81⁄2% Convertible Capital Bonds 2005

.   .   .   .   .   .   .   . 6th March .   .   .   .   .   .   .   .   .   .   .   .   .   . 6th September

$150m 73

8% MTN 1997

.   .   .   .   .   .   .   .   .   .   .   .   . 17th November

£150m 81⁄4% Notes 2000

.   .   .   .   .   .   .   .   .   .   .   .   . 22nd December

$200m 65

8% Notes 1999

.   .   .   .   .   .   .   .   .   .   .   .   . 31st December

$200m 61⁄4% Notes 2002

.   .   .   .   .   .   .   .   .   .   .   .   . 27th March

£200m 71⁄4% Notes 2002

.   .   .   .   .   .   .   .   .   .   .   .   . 7th June

Other Dates

Results for half year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

announced in October

Interim Report circulated

.   .   .   .   .   .   .   .   .   .   .   .   .   . November

Results for the year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

announced in May

Report and Accounts

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .

circulated in June

Annual General Meeting

.   .   .   .   .   .   .   .   .   .   .   .   .   .

July

Registered Office
and Advisers

REGISTERED OFFICE

J Sainsbury plc
Stamford House, Stamford Street
London SE1 9LL

Registered Number 185647

REGISTRAR

The Royal Bank of Scotland plc
Registrar’s Department, PO Box 82
Caxton House, Redcliffe Way
Bristol BS99 7NH

AUDITORS

Coopers & Lybrand
1 Embankment Place
London WC2N 6NN

SOLICITORS

Denton Hall
Five Chancery Lane, Clifford’s Inn
London EC4A 1BU

STOCKBROKERS

SBC Warburg
1 Finsbury Avenue
London EC2M 2PP

Hoare Govett Corporate Finance Ltd
4 Broadgate
London EC2M 7LE

36

J Sainsbury plc

Designed and Produced by McBain, Noel-Johnson & Co Ltd. Printed in England by Royle Print Limited.  
Printed on Zanders Mega-Matt paper made from 100% chlorine-free bleached pulp and awarded the Nordic Swan environmental label.
Photograph on page 10 courtesy of Sainsbury’s The Magazine.

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OPERATORS NOTES/CLIENT MESSAGE

OPERATORS NOTES/CLIENT MESSAGE

Tel 0171 387 7474  Fax 0171 387 9793

Tel 0171 387 7474  Fax 0171 387 9793

Cyan  Magenta  Yellow  Black  PMS295  PMS021  .Text Black

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Financial Calendar 1997/98

Dividend and Interest Payments

Ordinary Dividend

Final

.   .   .   .   .   .   .   .   .   .   .

payable 25th July 1997

Interim .   .   .   .   .   .   .   .   .   .   .

payable January 1998

8% Irredeemable Unsecured Loan Stock .   .   .   .   .   .   .  1st March

.   .   .   .   .   .   .   .   .   .   .   .   .   . 1st September

81⁄2% Convertible Capital Bonds 2005

.   .   .   .   .   .   .   . 6th March .   .   .   .   .   .   .   .   .   .   .   .   .   . 6th September

$150m 73

8% MTN 1997

.   .   .   .   .   .   .   .   .   .   .   .   . 17th November

£150m 81⁄4% Notes 2000

.   .   .   .   .   .   .   .   .   .   .   .   . 22nd December

$200m 65

8% Notes 1999

.   .   .   .   .   .   .   .   .   .   .   .   . 31st December

$200m 61⁄4% Notes 2002

.   .   .   .   .   .   .   .   .   .   .   .   . 27th March

£200m 71⁄4% Notes 2002

.   .   .   .   .   .   .   .   .   .   .   .   . 7th June

Other Dates

Results for half year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

announced in October

Interim Report circulated

.   .   .   .   .   .   .   .   .   .   .   .   .   . November

Results for the year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

announced in May

Report and Accounts

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .

circulated in June

Annual General Meeting

.   .   .   .   .   .   .   .   .   .   .   .   .   .

July

Registered Office
and Advisers

REGISTERED OFFICE

J Sainsbury plc
Stamford House, Stamford Street
London SE1 9LL

Registered Number 185647

REGISTRAR

The Royal Bank of Scotland plc
Registrar’s Department, PO Box 82
Caxton House, Redcliffe Way
Bristol BS99 7NH

AUDITORS

Coopers & Lybrand
1 Embankment Place
London WC2N 6NN

SOLICITORS

Denton Hall
Five Chancery Lane, Clifford’s Inn
London EC4A 1BU

STOCKBROKERS

SBC Warburg
1 Finsbury Avenue
London EC2M 2PP

Hoare Govett Corporate Finance Ltd
4 Broadgate
London EC2M 7LE

36

J Sainsbury plc

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Photograph on page 10 courtesy of Sainsbury’s The Magazine.

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J Sainsbury plc

Annual Review1997
and Summary Financial Statement

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J Sainsbury plc
Stamford House  Stamford Street  London SE1 9LL
http://www.sainsburys.co.uk

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J Sainsbury plc

Annual Accounts 1997

Contents

Report of the Directors 1-4

Report of the 
Remuneration Committee  5-8

Statement of 
Directors(cid:213) Responsibilities  9

Report of the Auditors 
on Corporate Governance  9

Report of the Auditors to the 
Shareholders of J Sainsbury plc 10

Accounting Policies 11

Balance Sheets 12

Group Profit and Loss Account 13

Group Cash Flow Statement 14-15

Group Statement of Total
Recognised Gains and Losses 15

Reconciliation of 
Movements in Shareholders(cid:213) Funds 15

Notes to the Accounts 16-28

Registered Office and Advisers

Annual Accounts
This publication includes the Directors(cid:213) Report, the Report of the Remuneration Committee, the Accounts, and the Auditors(cid:213)
Report for the period ended 8th March 1997. The Chairman(cid:213)s Statement and review of the business are contained in a separate
publication entitled Annual Review 1997 and Summary Financial Statement.

These Annual Accounts together with the Annual Review 1997 and Summary Financial Statement comprise the full Annual
Report and Accounts of J Sainsbury plc for 1997, in accordance with the Companies Act 1985. Copies may be obtained, free of
charge, by telephoning Freephone 0800 387504.

Report of the Directors
for the 52 weeks to 8th March 1997

Principal Activity

The principal activity of the Group is the retail distribution of food and home improvement and garden products.

Group Performance

A review of the Group(cid:213)s performance during the period, with comments on the financial results and future developments, is con-
tained in the Annual Review 1997 which is published separately and together with this document comprises the full Annual
Report and Accounts of J Sainsbury plc.

Sainsbury(cid:213)s Supermarkets Ltd

Towards the end of the financial year a separate Subsidiary company, Sainsbury(cid:213)s Supermarkets Ltd, was established to under-
take the major trading activity of the UK supermarket business and began trading on 9th March 1997. The table on page 3
shows those Directors who are also directors of the new company. 

Sainsbury(cid:213)s Bank plc

In February 1997 Sainsbury(cid:213)s Bank plc was launched. The company, 55% owned by J Sainsbury plc, received authorisation
under the Banking Act from the Bank of England to operate a new bank in association with Bank of Scotland.

Corporate Governance

The Group has complied throughout the period under review with all the provisions of the Code of Best Practice contained in
the Cadbury Committee(cid:213)s Report and as laid down in the Listing Rules of the London Stock Exchange.

The Board

The Board of Directors meets regularly and is responsible for the effective management of the business. During the year a num-
ber of changes were made to Directors(cid:213) responsibilities. David Bremner was appointed on 19th August 1996 as Chief Executive
of Homebase and US businesses. Dino Adriano has taken over from Tom Vyner as Chief Executive of the UK food retailing busi-
nesses. Tom Vyner as Deputy Chairman will concentrate on International Buying until he retires in January 1998.
Sir Terence Heiser GCB as Chairman of the Audit Committee is the nominated senior Non-Executive Director on the Board.
All Directors have access to the advice and services of the Company Secretary. In addition there is an agreed procedure for
Directors to take independent professional advice, if necessary, at the Company(cid:213)s expense. 

Board Committees

The Company(cid:213)s Remuneration Committee is responsible for advising on Executive Directors(cid:213) pay and benefits. The report of this
committee is set out on pages 5 to 8. The Nomination Committee advises the Board on the appointment of Executive Directors.
The Audit Committee receives reports regularly from the Group Internal Audit Department and ensures that an objective and
professional relationship is maintained between the Board and the external auditors. 

Internal Financial Control

The Directors are responsible for the Group(cid:213)s system of internal financial control. In order to meet that responsibility the Board
has established an organisational structure with clear responsibilities and authorities, corporate standards and procedures and a
thorough system of internal financial reporting.

The Board has carried out a formal review of the effectiveness of the systems of internal financial control using a Risk Self
Assessment process. This was carried out in all major Group companies and the results reviewed and signed off by the Board.

The Directors believe that proper accounting records are maintained and that financial information used within the business and
for publication is reliable.

The system of internal financial control can provide only reasonable, and not absolute, assurance against material misstatement
and loss. 

The key elements of the systems of internal financial control are:

Control Framework

There is an organisational structure with clear accountabilities and levels of authority. Group financial control standards are set
out in statements to the business and are supported by procedure manuals.

Process

There are well-established planning processes which include detailed operational budgets for the year ahead and projections for
future years. These are approved by the Board.

Performance against these budgets is reviewed by the Board. More detailed performance reviews are carried out by manage-
ment.

There are clear policies and procedures for capital expenditure. These include investment appraisals, authorisation procedures
and post-implementation reviews.

Treasury policy changes and significant treasury transactions are reviewed and approved by the Board. Foreign exchange trans-
actions are undertaken solely for the operation of the business and exposures are actively managed to reduce or eliminate
exchange rate risk.

J Sainsbury plc

1

Report of the Directors — continued

Review

The Audit Committee has responsibility for ensuring that internal financial control is defined and monitored. It reviews interim
and annual financial statements and receives regular reports from management, internal audit and external audit.

The Group has a well-established internal audit function. Homebase and Shaw(cid:213)s have their own internal audit departments. The
responsibility for the internal audit of Sainsbury(cid:213)s Bank is undertaken by Bank of Scotland, whilst Group Internal Audit covers
Sainsbury(cid:213)s Supermarkets Ltd and other Group companies. The Head of Group Internal Audit has overall responsibility for cov-
erage and reports significant matters to, and has direct access to, the Audit Committee.

Sainsbury(cid:213)s Bank was established with appropriate controls in place and the existence of such controls was a factor considered
by the Bank of England in granting Sainsbury(cid:213)s Bank authorised institution status under the Banking Act. Controls will be extend-
ed, as necessary, as the bank develops.

The Risk Self Assessment process established by the Group allows management to consider internal financial control. This is
used as a regular management tool and is formally reviewed and signed off by the Board annually.

Going Concern

In order to comply with the Code, the Directors confirm that they are satisfied that the Group has sufficient resources to continue
in operation for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the Group
Accounts.

Profit and Dividend

The profit on the ordinary activities of the Group before tax amounted to £609 million (1996: £712 million).

The Directors are proposing the payment of a final dividend of 8.8p per share on 25th July 1997 to shareholders on the
Register at the close of business on 23rd May 1997; together with the interim dividend paid of 3.5p per share, this makes a
total dividend for the year of 12.3p (1996: 12.1p) per share.

Share Capital

The principal changes in share capital during the period were as follows:

—  5.6 million shares were allotted and further options granted under the Company(cid:213)s share schemes for employees;

—  2.7 million shares were allotted under the terms of the share dividend alternative to shareholders.

Further details are given in Note 12.

A Resolution will be proposed at the Annual General Meeting to renew the authority of the Directors to issue shares without
applying the statutory pre-emption rights.

A Resolution will also be proposed at the Annual General Meeting to enable the Company to make market purchases of its own
shares up to a maximum of 184 million shares.

The full text of the Resolutions is set out in the Notice of Meeting.

Share Dividend Alternative

Around 30,000 shareholders elected to take shares instead of cash for both the final dividend for 1996 and the interim dividend
for 1997. Shareholders are to be offered a similar choice in respect of the final dividend payable in July 1997 and the interim
dividend for 1998.

Homebase

The 25% minority interest in Homebase was purchased from GIB Group in August 1996 for £65 million. See Note 5.

Following the completion of expert determination, the Group received a repayment of £10 million relating to the purchase of
Texas Homecare. See Note 5.

US Supermarket Operation

Shaw(cid:213)s expanded its number of outlets by purchasing 12 stores from subsidiaries of Royal Ahold NV for $52 million in 
October 1996.

The Group(cid:213)s holding in Giant Food Inc. was increased by 3% to approximately 20% following the purchase of two million shares
at a cost of $62 million in August 1996. See Note 5.

Year 2000

It is estimated that work on converting computer software to deal with the year 2000 date change will cost the Group £40 mil-
lion in total at current rates, of which three-quarters will be incurred by Sainsbury(cid:213)s Supermarkets Ltd. We have been proactive in
advancing this work and half of this expenditure will be incurred in the current financial year. The costs will be charged to the
Profit and Loss Account as incurred.

Policy on Payment of Suppliers

The Company intends to continue its policy of agreeing terms of payment prior to commencing trade with a supplier and it will
be the Company(cid:213)s policy to abide by those terms based on the timely submission of satisfactory invoices.

The Company subscribes to the CBI code of good practice in the prompt payment of suppliers.

2

J Sainsbury plc

Market Value of Properties

The Directors believe that the aggregate open market value of Group properties exceeds the net book value of £4,578 million
by a considerable margin.

Employment Policies

Employment policies aim to respect, motivate and develop our staff so they are responsive to the needs of customers. We are
committed to equal opportunities and to investing in the development of all our people. We recognise the difficulties that people
with disabilities face when seeking employment and have communicated our commitment in this area to all management. We
have been awarded the usage of the symbol (cid:212)Positive about disabled people(cid:213), demonstrating our commitment to improving
employment opportunities for applicants with disabilities or employees who become disabled. We currently spend £38 million
on training and development each year and are committed to achieving the Investors in People award throughout the Company.
We have continued our drive to improve the flow of communication between senior management and staff. In response to last
year(cid:213)s opinion survey Staff Councils have been introduced, enhancing existing communication mechanisms and ensuring that
senior management are kept abreast of the views of all staff. The Group offers a full range of employee share schemes and about 
one-third of all shareholders are employees or former employees.

Donations

Donations to charitable organisations and local community projects amounted to £2 million (1996: £2 million), which included
contributions to enterprise agencies, job creation, educational schemes, town centre management initiatives, community projects
and the arts. There were no political donations.

Research and Development

The Scientific Services Division employs 156 people and has an annual expenditure of £7.5 million. It works in close co-opera-
tion with suppliers to achieve the highest standards of product quality, hygiene and safety and to maintain them throughout the
Company(cid:213)s distribution chain and stores. The Division also develops and co-ordinates policies to address issues of concern and
interest to our customers, for example environmental management and healthy eating.

Directors and Directors(cid:213) Interests

The Directors of J Sainsbury plc as at 8th March 1997 are listed below, together with their respective membership of Board
Committees and of the Board of Sainsbury(cid:213)s Supermarkets Ltd.

D J Sainsbury .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
R T Vyner .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
D B Adriano .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
D M Bremner .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
I D Coull
R Cooper
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
J E Adshead CBE .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
C I Harvey.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
R P Whitbread .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
R P Thorne .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
D J Clapham .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
K McCarten .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Sir Terence Heiser GCB .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Dr J M Ashworth .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Rt Hon Sir Timothy Sainsbury.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Sir Clive Thompson.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Sir David Scholey CBE.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Audit Remuneration

Nomination
*
*

Sainsbury(cid:213)s
Supermarkets
Ltd

*

*
*
*

*

*
*

*
*
*
*
*

*
*
*
*
*

*
*
*
*
*

All Directors held office throughout the period except Sir David Scholey CBE who was appointed as a Non-Executive Director
on 18th July 1996 and D M Bremner who was appointed on 19th August 1996. D A Quarmby retired on 26th April 1996. C I
Harvey retired from the Board on 8th April 1997. Mr Harvey will continue as Managing Director of Savacentre until June 1999.

In accordance with the Articles of Association R P Thorne, D J Clapham, Sir Terence Heiser GCB and Dr J M Ashworth will retire
by rotation and, with the exception of Dr J M Ashworth, will seek re-appointment at the Annual General Meeting on 9th July
1997.

Sir David Scholey CBE and D M Bremner were appointed during the period and will be proposed for re-appointment at the
Annual General Meeting. Miss Thorne and Messrs Clapham and Bremner, being proposed for re-appointment at the Annual
General Meeting, have service contracts on a rolling 24-month basis.

No Director had, during or at the end of the period, any material interest in any contract of significance to the Group(cid:213)s business.

Details of Directors(cid:213) interests in the ordinary shares of the Company are set out in the Report of the Remuneration Committee
on page 7.

J Sainsbury plc

3

Report of the Directors — continued

Substantial Interests

The substantial interests notified to the Company, all of which include duplications, are set out below:

Miss J S Portrait and C T S Stone are trustees of various settlements, including charitable settlements. At 6th May 1997 the total
holdings of the trusts of which the above are trustees amounted to 17% and 5% respectively. 

At 6th May 1997 the interests, as trustees of charitable and other trusts and beneficially, of D J Sainsbury, the Hon S D
Sainsbury, Lord Sainsbury of Preston Candover KG and the Rt Hon Sir Timothy Sainsbury were 17%, 4%, 4% and 4% respec-
tively.

Annual General Meeting

The 1997 Annual General Meeting of shareholders will take place at 12 noon on Wednesday 9th July 1997 at The Queen
Elizabeth II Conference Centre, Broad Sanctuary, Westminster, London SW1P 3EE. The Notice of Meeting and proxy card
accompany these Annual Accounts.

Auditors

A Resolution to re-appoint Coopers & Lybrand as Auditors of the Company and to authorise the Directors to fix their remuner-
ation will be put to the Annual General Meeting.

By Order of the Board

N F Matthews

Secretary

6th May 1997

4

J Sainsbury plc

Report of the Remuneration Committee

Composition and Terms of Reference

The Remuneration Committee consists entirely of Non-Executive Directors and is chaired by Sir Clive Thompson. The member-
ship of the Committee is shown on page 3.

The Committee(cid:213)s terms of reference provide for it to make recommendations to the Board on all matters relating to the remu-
neration of the Executive Directors of the Company. These recommendations are considered by the Board but no Director par-
ticipates in the decision relating to his or her own remuneration. The Company has complied throughout the period with Section
A of the best practice provisions on Directors(cid:213) remuneration annexed to the Listing Rules of the Stock Exchange.

Policy on Remuneration of Executive Directors

Total Level of Remuneration

In framing its remuneration policy the Committee has given full consideration to Section B of the best practice provisions on
Directors(cid:213) remuneration, annexed to the Listing Rules of the London Stock Exchange. The Committee aims to ensure that the
remuneration offered is competitive and will attract, retain and motivate Executive Directors of the highest calibre. In doing so, 
the Committee takes account of information from internal and independent sources on the remuneration for similar jobs in com-
parable companies in the retail sector and other large companies.
The main components of Executive Directors(cid:213) remuneration are:—
i) Basic Salary

Basic salary for each Director is determined taking into account assessments of individual performance.

ii) Share Option Schemes

Two new Share Option Schemes were established following the approval of shareholders at the Annual General Meeting in
1996. The arrangements reflect the Company(cid:213)s belief that share ownership by Executive Directors and senior executives
strengthens the link between their personal interests and those of all shareholders and incentivises personal performance.

Options to Directors up to a value of one times salary are normally granted at intervals of approximately 18 months.

Under the new approved Executive Share Option Scheme options will be granted up to the maximum amount permitted by the
Inland Revenue, currently £30,000. Grants of options above the amount of £30,000 will be made under a so-called (cid:212)unap-
proved(cid:213) Executive Share Option Scheme and will take into account the relevant institutional guidelines.

For any individual the maximum amount of outstanding options at any time under both schemes will be four times total annual
remuneration. The performance criterion currently required to be satisfied prior to exercise of options will be an average over a
three-year period of 2% per annum real growth in earnings per share.

iii) Long-Term Incentive Scheme

In addition to the above, a long-term incentive scheme was approved by shareholders at the Annual General Meeting in 1996.
This scheme is designed to provide Executive Directors with a bonus established by a formula related to real growth in earnings
per share. No bonus will be earned in respect of any year unless real growth in earnings per share as against the previous year is
at least 2%. Bonuses will be paid half in cash and half in shares. The shares will be held in trust for three years and may be aug-
mented at the end of that period depending on performance measured in relation to real growth in earnings per share.

The Remuneration Committee has reviewed the performance criterion under this Scheme and as a result of its recommendations
the Board has, for the current year, stipulated as an additional criterion that the Group must achieve certain profit targets before
bonuses are payable to Executive Directors.

For other senior executives who participate in the bonus arrangements, the performance criterion will be based on the achieve-
ment by the relevant operating company of its budgeted profit before tax for the year, and not on Group earnings per share.

The long-term incentive scheme came into effect in respect of the financial period ended 8th March 1997; no bonus is payable
in respect of the year under review as the performance criterion was not met.

iv) Other Share Options

Executive Directors are granted and hold options under the Savings-Related Share Option Scheme (see page 8).

v) Profit Sharing

Executive Directors participate in the Company(cid:213)s Profit Sharing Scheme in the same way as all other participants. Although profit
sharing is accounted for on an accruals basis, payments are not finally calculated and paid until after the Annual General
Meeting. Accordingly, profit sharing to Directors is included on a paid basis in the table of Directors(cid:213) Emoluments on page 6.

Profit sharing in respect of the period ended 8th March 1997 which will be paid in August 1997 is expected to amount to
approximately 4.5% of basic salary (1996: 7.1%).

vi) Benefits

Benefits include the provision of a company car and medical insurance premiums.

J Sainsbury plc

5

Report of the Remuneration Committee — continued

Contracts of Service

With the exception of the Chairman and the Non-Executive Directors, who do not have service contracts, the service contracts
for the Executive Directors are on a rolling 24-month basis, or have less than 24 months to run. The Executive Directors who
are being proposed for re-appointment as Directors at the Annual General Meeting have service contracts on a rolling 24-
month basis. The Remuneration Committee considers such notice periods are reasonable and necessary to attract and retain
high calibre executive directors. The Committee endorses the principle of mitigation of damages on early termination of a ser-
vice contract.

Company Pension Policy regarding Executive Directors

The Group(cid:213)s policy is to offer its most senior employees membership of the J Sainsbury Executive Pension Scheme.

The scheme is a funded, Inland Revenue approved, final salary, occupational pension scheme. Under the Group(cid:213)s pension
arrangements the Executive Directors are entitled to a pension on retirement at age 60, or earlier in the event of 40 years ser-
vice, or ill health, of up to two-thirds of their pensionable earnings (defined as salary in the last 12 months of service) subject to
Inland Revenue limits. The previous practice of including the average of the performance-related bonus paid in the Company(cid:213)s
last three financial years has been discontinued. Pensions are also payable to dependants on death and a lump sum is payable if
death occurs in service.

In the case of four Directors who joined the Company on or after 17th March 1987 the Company has agreed to make up that
portion of the standard pension entitlement which is in excess of Inland Revenue limits. This last obligation is unfunded, although
full provision of £299,000 has been made in respect of the period ended 8th March 1997 (1996: £147,000).

Pending the outcome of further official guidance on disclosure of pension values the Company has retained the method of dis-
closure used last year. In respect of continuing Directors, the pension contributions included in the tables of Directors(cid:213) emolu-
ments are 8.8% (1996: 8.5%) of pensionable earnings which was the level of Company contribution into the J Sainsbury
Executive Pension Scheme.

Directors(cid:213) Emoluments

The aggregate emoluments of the Directors of the Company were as follows:—

Executive Directors

1997
£000

1996
£000

Basic salary.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Other salary payments.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Long-term incentive scheme/Performance-related bonus .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Profit sharing.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Benefits.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Compensation for loss of office .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Pension contributions.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

2,896
495
(cid:209)
200
165

2,889
62
—
270
149
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
3,370
271
465
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
4,106

3,756
336
812

4,904

Non-Executive Directors

Fees.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

111

79
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
4,185
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

5,015

The emoluments of each of the Executive Directors are set out below:—
Other salary
payments
1997 1996
£000 £000

Benefits

—

455

Totals

Pension

1997 1996
£000 £000

Basic
salary
1997 1996
£000 £000
296
405
212
—
225
227
204
177
184
196
157
51
345
145
65

1997 1996
£000 £000
359
491
261
—
272
280
253
216
228
240
197
122
413
680
94
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
2,896 2,889
465 4,904 4,106
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

Compensation
for loss of office contribution
1997 1996
£000 £000
25
34
18
—
19
19
17
15
16
17
13
4
29
236
3

Sub
totals
1997 1996
£000 £000
334
457
243
—
253
261
236
201
212
223
184
118
384
173
91

Profit
sharing
1997 1996
£000 £000
27
36
18
—
20
20
18
16
16
17
14
—
31
12
25

1997 1996
£000 £000
11
16
13
—
8
14
14
8
12
10
13
5
8
16
1

370
569
334
633
282
291
266
219
238
255
199
261
977
10
(cid:209)

343
527
309
620
261
270
247
203
221
237
184
244
80
10
(cid:209)

27
42
25
13
21
21
19
16
17
18
15
17
561
(cid:209)
(cid:209)

310
475
280
145
235
240
217
180
195
210
165
190
54
(cid:209)
(cid:209)

11
22
14
20
10
14
15
10
13
13
8
14
1
(cid:209)
(cid:209)

22
30
15
(cid:209)
16
16
15
13
13
14
11
(cid:209)
25
10
(cid:209)

149 3,756 3,370

336
(cid:209)

—
271

495

271

200

336

165

270

812

40

62

62

D J Sainsbury1
.
.   .
R T Vyner
D B Adriano
.
D M Bremner2 .
.   .   .
I D Coull
R Cooper
.   .
J E Adshead CBE
C I Harvey .   .
R P Whitbread .
R P Thorne .   .
D J Clapham .
K McCarten3
.
D A Quarmby4 .
I J Hunt5
.   .   .
R A Clark6
.

6

J Sainsbury plc

The emoluments of each of the Non-Executive Directors are set out below:—

Sir Terence Heiser GCB.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Dr J M Ashworth.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Rt Hon Sir Timothy Sainsbury7.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Sir Clive Thompson7.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Sir David Scholey CBE8.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Lady Eccles 9.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Fees

1997
£000
24
22
22
22
21
(cid:209)

1996
£000
22
21
15
15
—
6
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
79
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

111

Notes to the tables:—
1. Chairman.

2. Appointed 19th August 1996. Mr Bremner received £400,000 in respect of acceptance of office and £55,000 guaranteed

payments in respect of performance bonus and profit sharing.

3. Appointed 2nd December 1995. In 1996 Mr McCarten received £62,000 in respect of acceptance of office. In 1997

£40,000 was paid to him in respect of guaranteed performance bonus and profit sharing.

4. Retired as a Director on 26th April 1996. 1997 pension contribution included £556,000 in respect of compensation for loss
of office. In addition, D A Quarmby retains the right to exercise 391,587 options over ordinary shares previously granted
under the Company(cid:213)s option schemes. These options have exercise prices ranging from 272.7p to 475.0p. The average exer-
cise price is 396.4p.

5. Retired as a Director on 7th March 1996. 1996 pension contribution included £225,000 in respect of compensation for loss

of office. 1997 profit sharing is in respect of financial year 1996 when he was a Director.

6. Retired as a Director on 28th April 1995.

7. Appointed 5th July 1995. The fees of Sir Clive Thompson are remitted to Rentokil Initial plc.

8. Appointed 18th July 1996.

9. Retired 5th July 1995.

Directors(cid:213) Interests

8th March
1997

Details of the Directors(cid:213) interests in the ordinary shares of the Company are as follows:—
Ordinary Shares

9th March
1996
D J Sainsbury†.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .259,337,168321,674,572
R T Vyner.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
19,952
16,683
D B Adriano.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
41,043
37,764
D M Bremner.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
2,456
2,431*
I D Coull.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
23,674
23,674
R Cooper.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
85,760
81,535
J E Adshead CBE.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
34,153
29,504
C I Harvey.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
81,920
88,386
R P Whitbread.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
42,781
40,574
R P Thorne.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
10,037
7,653
D J Clapham.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
31,483
39,056
K McCarten.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
1,353
1,310
Sir Terence Heiser GCB.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
1,000
1,000
Dr J M Ashworth.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
2,112
2,182
Rt Hon Sir Timothy Sainsbury .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .    .   .   . 13,431,900
13,431,900
Sir Clive Thompson.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
881
881
Sir David Scholey CBE.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
(cid:209)  *
15,000

*At date of appointment

†On 21st May 1996 D J Sainsbury(cid:213)s beneficial interest reduced by 62,337,404 shares and his non-beneficial interest increased
by 61,732,874 shares. The change, which did not involve a disposal of shares, was of a technical nature connected with family
trusts.

The above beneficial holdings include the Directors(cid:213) personal holdings and those of their spouses and minor children, as well as
holdings in family trusts of which a Director or his minor children are beneficiaries or potential beneficiaries. It includes also the
beneficial interest in shares which are held in trust under the J Sainsbury Profit Sharing Scheme.
In addition the Directors have the following non-beneficial interests:—
D J Sainsbury has a non-beneficial interest in holdings of 66,304,671 (1996: 4,703,759) shares and £43,974 (1996: £43,974) 
8% Irredeemable Unsecured Loan Stock in trusts, including a charitable trust, of which he is a trustee.

The Rt Hon Sir Timothy Sainsbury has a non-beneficial interest in holdings of 65,166,069 (1996: 66,538,569) shares.

There were no changes to the Directors(cid:213) interests shown above between 8th March 1997 and 6th May 1997.

J Sainsbury plc

7

Report of the Remuneration Committee — continued

Options over Ordinary Shares

Directors(cid:213) options under the Company(cid:213)s Executive Share Option Scheme and Savings-Related Share Option Scheme are set out
in the table below:—

Total
10th March
1996

312,247
416,487
195,590
233,526
244,011

223,514
191,328
168,402
200,926
142,753
73,834

D J Sainsbury
R T Vyner
D B Adriano
I D Coull
R Cooper

.   .   .   .
.   .   .   .   .
.   .   .   .
.   .   .   .   .   .
.   .   .   .   .   .

J E Adshead CBE
C I Harvey
R P Whitbread
R P Thorne
D J Clapham
K McCarten

.   .   .
.   .   .   .   .
.   .   .   .
.   .   .   .   .
.   .   .   .
.   .   .   .   .

Number
granted

Number
exercised

Date
exercised

Option Market price
on exercise
Pence

price
Pence

Total
8th March
1997

—
160
189
141
401

494
186
283
141
213
—

—
569
569
—
1,075
271
271
271
—
—
—
—

4.10.96
17.4.96

3.4.96
5.3.97
5.3.97
5.3.97

237.1
237.1

237.1
276.0
276.0
276.0

361.5
372.0

371.0
320.0
320.0
320.0

312,247
416,078
195,210
233,667
243,066

223,737
191,243
168,685
201,067
142,966
73,834

All options granted and exercised during the period are in respect of the Savings-Related Share Option Scheme.

Options outstanding above and below the market price of 316.5p on 8th March 1997 are set out in the table below:—

Options outstanding
below market price
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
Weighted
Number
average
price
Pence

Options outstanding
above market price
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
Weighted
Number
average
price
Pence

47,666
1,881
2,143
449
1,709
2,507
1,405
14,137
2,983
2,342
—

272.7
299.2
302.4
306.4
302.6
305.1
303.6
275.4
300.6
300.0

264,581
414,197
193,067
233,218
241,357
221,230
189,838
154,548
198,084
140,624
73,834

389.7
423.0
421.4
421.2
413.7
402.2
421.4
393.1
422.6
418.3
386.0

Number of 
options
outstanding

312,247
416,078
195,210
233,667
243,066
223,737
191,243
168,685
201,067
142,966
73,834

D J Sainsbury .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
R T Vyner.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
D B Adriano
I D Coull
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
R Cooper .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
J E Adshead CBE .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
C I Harvey .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
R P Whitbread .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
R P Thorne .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
D J Clapham .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
K McCarten .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

No options lapsed during the period. The options outstanding are exercisable at prices between 272.7p and 475.0p. In the peri-
od from 10th March 1996 to 8th March 1997 the highest middle market price was 407.0p and the lowest middle market price
was 308.0p.

Approved by the Board on 6th May 1997.

Sir Clive Thompson
Chairman of the Remuneration Committee

8

J Sainsbury plc

Statement of Directors(cid:213) Responsibilities

Company law requires the Directors to prepare accounts for each financial year which give a true and fair view of the state of
affairs of the Company and the Group at the end of the period and of the profit or loss of the Group for that period. In prepar-
ing accounts, the Directors are required to:

•

select suitable accounting policies and then apply them consistently;

• make judgements and estimates that are reasonable and prudent;

•

•

state whether applicable accounting standards have been followed, subject to any material departures disclosed and
explained in the accounts;

prepare the accounts on the going concern basis unless it is inappropriate to assume that the Company will continue in busi-
ness.

The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the
financial position of the Company and to enable them to ensure that the accounts comply with the Companies Act 1985. They
are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention of
fraud and other irregularities.

Report of the Auditors to J Sainsbury plc on Corporate Governance

In addition to our audit of the financial statements, we have reviewed the Directors(cid:213) statement on pages 1 and 2 concerning the
Company(cid:213)s compliance with the paragraphs of the Cadbury Code of Best Practice specified for our review by the London Stock
Exchange and their adoption of the going concern basis in preparing the financial statements. The objective of our review is to
draw attention to non-compliance with Listing Rules 12.43(j) and 12.43(v).

Basis of Opinion

We carried out our review in accordance with guidance issued by the Auditing Practices Board. That guidance does not require
us to perform the additional work necessary to, and we do not, express any opinion on the effectiveness of either the Group(cid:213)s
system of internal financial control or its corporate governance procedures nor on the ability of the Group and the Company to
continue in operational existence.

Opinion

With respect to the Directors(cid:213) statements on internal financial control on pages 1 and 2 and going concern on page 2, in our
opinion the Directors have provided the disclosures required by the Listing Rules referred to above and such statements are not
inconsistent with the information of which we are aware from our audit work on the financial statements.

Based on enquiry of certain Directors and Officers of the Company, and examination of relevant documents, in our opinion the
Directors(cid:213) statement on pages 1 and 2 appropriately reflects the Company(cid:213)s compliance with the other aspects of the Code
specified for our review by Listing Rule 12.43(j).

Coopers & Lybrand
Chartered Accountants 
London
6th May 1997

J Sainsbury plc

9

Report of the Auditors to the Shareholders of J Sainsbury plc

We have audited the accounts on pages 11 to 28.

Respective responsibilities of Directors and Auditors

As described on page 9 the Company(cid:213)s Directors are responsible for the preparation of accounts. It is our responsibility to form
an independent opinion, based on our audit, on those accounts and to report our opinion to you.

Basis of Opinion

We conducted our audit in accordance with Auditing Standards issued by the Auditing Practices Board. An audit includes exami-
nation, on a test basis, of evidence relevant to the amounts and disclosures in the accounts. It also includes an assessment of the
significant estimates and judgements made by the Directors in the preparation of the accounts, and of whether the accounting
policies are appropriate to the Company(cid:213)s circumstances, consistently applied and adequately disclosed.

We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in
order to provide us with sufficient evidence to give reasonable assurance that the accounts are free from material misstatement,
whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of the pre-
sentation of information in the accounts.

Opinion

In our opinion the accounts give a true and fair view of the state of affairs of the Company and the Group at 8th March 1997 and
of the profit, total recognised gains and cash flows of the Group for the 52 weeks then ended and have been properly prepared
in accordance with the Companies Act 1985.

Coopers & Lybrand
Chartered Accountants and Registered Auditors 
London
6th May 1997

10

J Sainsbury plc

Accounting Policies

Basis of Accounts 

These accounts have been prepared under the historical cost convention as modified by the revaluation of certain properties.
They comply with all applicable Accounting and Financial Reporting Standards.

FRS 1 (Revised 1996) has been adopted earlier than the mandatory starting date as encouraged by the Accounting Standards
Board. The 1996 Cash Flow Statement has been restated.

No Profit and Loss Account is presented for the Company as provided by Section 230(3) of the Companies Act 1985.

All the activities in the Group are continuing businesses.

Consolidation

The results of Subsidiaries and Associated Undertakings are included in the Group Profit and Loss Account from the date of acquisi-
tion.

Goodwill arising in connection with the acquisition of shares in Subsidiaries and Associated Undertakings is deducted from
reserves in the period of acquisition. Goodwill comprises the excess of the purchase price over the fair value of the net tangible
assets acquired.

Sales

Sales consist of sales through retail outlets and sales of development properties. Rental and other income is excluded.

Cost of Sales

Cost of sales consists of all costs to the point of sale including warehouse and transportation costs and all the costs of operating
retail outlets.

Deferred Tax

Deferred tax is accounted for, at anticipated tax rates, in respect of all timing differences between accounting and tax treatment,
except to the extent that it is thought reasonably probable that the tax effects of such deferrals will continue for the foreseeable
future.

Depreciation

Freehold land is not depreciated. Freehold buildings, and leasehold buildings with more than 50 years unexpired, are depreciated
in equal instalments at the rate of 2% per annum. 

Leasehold properties with less than 50 years unexpired are depreciated to write off their book value in equal annual instalments
over the unexpired period of the lease. 

Certain tenants(cid:213) fixtures, which have been capitalised as part of leasehold properties, are depreciated in equal annual instalments
over the estimated useful life of the asset to the Group.

Fixtures, equipment and vehicles are depreciated in equal annual instalments to write off their cost over their estimated useful
lives, which range from 3 to 15 years, commencing when they are brought into use. 

A permanent diminution in value of any fixed asset is charged to the Profit and Loss Account.

Capitalisation of Interest

Interest incurred on borrowings to finance specific property developments is capitalised net of tax relief.

Research and Development

Research and development expenditure is written off as incurred against the profits of the period.

Pension Costs

The costs of providing pensions for employees are charged in the Profit and Loss Account in accordance with the recommenda-
tions of independent qualified actuaries. Any funding surpluses or deficits that may arise from time to time are amortised over
the average service life of members of the relevant scheme.

Leased Assets

Assets used by the Group which have been funded through finance leases are capitalised and the resulting lease obligations are
included in creditors net of finance charges. Interest costs on finance leases and all payments in respect of operating leases are
charged directly to the Profit and Loss Account.

Stocks

Stocks are valued at the lower of cost and net realisable value. Stocks at warehouse are valued at cost, and at retail outlets at
calculated average cost prices.

Foreign Currencies

Foreign currency assets and liabilities are translated at the exchange rates ruling at the Balance Sheet date. Results from over-
seas companies are translated at the average rates of exchange for the relevant accounting period and at the period-end rates
for the balance sheets. Differences on translation of investments in overseas companies and related loans are taken directly to
reserves.

J Sainsbury plc

11

Balance Sheets
8th March 1997

Group

Company 

Fixed Assets 

Tangible assets  .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Investments 

1
2

Note

Current Assets 

Stocks 
Debtors 
Investments
Cash and liquid funds

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

6
7
8

Creditors: due within one year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

9

Net Current Liabilities.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m

1996
£m

1997
£m

1997
£m

5,458
117

5,893
148

4,281
1,565
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
5,846
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

4,592
1,839

6,041

6,431

5,575

744
253
7
241

357
174
(cid:209)
84
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
615

761
204
5
209

349
186
(cid:209)
100

1,245

1,179

635

(2,519)

(2,804)

(2,280)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
(1,665)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(1,559)

(2,472)

(1,837)

(1,340)

Total Assets less Current Liabilities .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

4,482

4,235

4,594

4,181

Creditors: due after one year

Convertible Capital Bonds .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Other .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .
Provisions for Liabilities and Charges
Minority Equity Interest .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

9
9
11

(156)
(595)
(55)
(5)

(156)
(480)
(54)
(11)

(cid:209)
(715)
(10)

(cid:209)
(483)
(15)

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
3,683
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

3,671

3,869

3,534

458
1,074
43
1,959

460
1,097
33
2,081

458
1,074
44
2,107
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
3,683
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

460
1,097
34
2,278

3,671

3,869

3,534

Capital and Reserves 

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Called up share capital
Share premium account
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Revaluation reserve .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Profit and loss account .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

12
13
14
15

Equity Shareholders(cid:213) Funds

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Notes to the accounts are on pages 16 to 28.

The Accounts on pages 11 to 28
were approved by the Board of Directors on 
6th May 1997, and are signed on its behalf by

D J Sainsbury Chairman

R T Vyner Deputy Chairman

12

J Sainsbury plc

Group Profit and Loss Account
for the 52 weeks to 8th March 1997

Note

1997
£m

1996
£m

Group Sales including VAT & sales taxes.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 16

14,312

13,499

VAT & sales taxes.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group Sales excluding VAT & sales taxes .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Cost of sales.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 16
Exceptional cost of sales — Texas Homecare integration costs .   .   .   .   .   .   .   .   .   .   .   .   . 11

Gross Profit.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Administrative expenses.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 16

Group Operating Profit before profit sharing .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 16

Profit sharing.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 17

Group Operating Profit.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Associated Undertakings — share of profit .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Profit/(loss) on sale of fixed assets.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

4

Profit on Ordinary Activities before Interest .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Net interest payable.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 18

Profit on Ordinary Activities before Tax.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 19

Tax on profit on ordinary activities.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 22

Profit on Ordinary Activities after Tax.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Minority equity interest.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit for the Financial Year.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Dividends.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .23

Retained Profit.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

917

872
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
12,627

13,395

12,363
50

11,521
48
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1,058

982

287

252
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
806

695

37

50
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
756

658

19
8

19
(4)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
771

685

76

59
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
712

609

208

234
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
478

401

2

10
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
488

403

226

222
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
266
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

177

Earnings Per Share.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 24

22.0p

26.8p

Exceptional cost of sales.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
(Profit)/loss on sale of fixed assets.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Earnings Per Share before exceptional cost of sales 
and profit/loss on sale of fixed assets.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 24

1.8p
(0.4p)

1.3p
0.2p

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

23.4p

28.3p

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

Fully Diluted Earnings Per Share.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 24
Fully Diluted Earnings Per Share before exceptional cost of sales 
and profit/loss on sale of fixed assets.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 24

21.8p

26.4p

23.1p

27.8p

J Sainsbury plc

13

Group Cash Flow Statement
for the 52 weeks to 8th March 1997

Note
Net cash inflow from operating activities.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 25

Returns on investments and servicing of finance

Interest received.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Interest paid.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Interest element of finance lease rental payments
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Dividends received from Associated Undertakings

Net cash outflow from returns on investments and servicing of finance .   .   .   .   .   .   .   .   .   .   .   .   .   .

1997

1996
(restated)
£m
1,012
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

£m
1,085

12
(93)
(12)
5

11
(73)
(9)
5
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
(66)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(88)

Tax paid.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(206)

(271)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

Capital expenditure and financial investment

Payments for tangible fixed assets .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Receipts from sale of tangible fixed assets.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Purchase of investments.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Net cash outflow from capital expenditure and financial investment

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Acquisitions and disposals

Purchase of minority interest in Homebase Group .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Purchase of Texas Homecare.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Cash acquired with Texas Homecare.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Purchase of other Subsidiaries.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Investment in Sainsbury(cid:213)s Bank by minority shareholder
Purchase of investment in Giant Food Inc. .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Investment in other Associated Undertakings

Net cash outflow from acquisitions and disposals

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Equity dividends paid.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Management of liquid resources.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Financing

Issue of ordinary share capital
Debt due within a year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Increase in short-term borrowing .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Repayment of term loans.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Debt due beyond a year

Increase in long-term borrowing.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Capital element of finance lease rental payments

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Net cash inflow from financing.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(801)
79
(1)

(709)
50
(4)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
(663)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(723)

(66)
9
(cid:209)
(3)
7
(41)
(7)

—
(309)
9
(21)
—
—
(4)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
(325)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(101)

(214)

(208)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

—
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(cid:209)

15

331
(207)

22

325
(31)

260
(3)

182
(6)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
492
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

396

Increase/(decrease) in cash in the period.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

149

(29)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

14

J Sainsbury plc

Reconciliation of Net Cash Flow to Movement in Net Debt

Increase/(decrease) in cash in the period.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Cash inflow from increase in debt and lease financing .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Cash inflow from change in liquid resources .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Note

Change in net debt resulting from cash flows.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Loans and finance leases acquired with Subsidiary.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
New finance leases.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Currency translation difference.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Debt converted into share capital .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Loan note issued as settlement for acquisition .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Movement in net debt in the period .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 26

Net debt at the beginning of the period.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 26

Net debt at the end of the period.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   . 26

1997
£m
149
(381)
(cid:209)

1996
£m
(29)
(470)
—
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
(499)

(232)

(cid:209)
(13)
26
(cid:209)
(cid:209)

(20)
(18)
(15)
44
(18)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
(526)

(219)

(1,217)

(691)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
(1,217)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(1,436)

Group Statement of Total Recognised Gains and Losses
for the 52 weeks to 8th March 1997

Profit for the Financial Year.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

1997
£m
403

1996
£m
488

Currency translation differences on foreign currency net investments .   .   .   .   .   .   .   .   .   .   .   .

Total recognised gains and losses relating to the Financial Year .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(4)

2
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
490
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

399

There is no material difference between the above profit for the period and the historical cost equivalent.

Reconciliation of Movements in Shareholders(cid:213) Funds

Group

Company 

Profit for the Financial Year

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Dividends

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

.   .   .   .   .   .   .   .   .   .   .   .   .   .
Currency translation differences
.   .   .   .   .   .   .   .   .   .
Goodwill deducted from reserves (Note 5)
New share capital subscribed less expenses of capital issues
.   .   .
Other (Note 15) .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Net movement in Shareholders(cid:213) Funds .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Opening Shareholders(cid:213) funds

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Closing Shareholders(cid:213) Funds .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m
576

1997
£m
403

1997
£m
387

1996
£m
488

(222)

(226)

(226)

(222)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
354
(cid:209)
(cid:209)
80
109
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
543

266
2
(103)
80
(cid:209)

177
(4)
(66)
25
5

161
(cid:209)
(cid:209)
25
(cid:209)

137

186

245

3,289

3,534

3,140
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
3,683
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

3,869

3,683

3,671

3,534

J Sainsbury plc

15

Notes to the Accounts
at 8th March 1997

Note 1 Tangible Fixed Assets

Group

Company

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
Total

Properties

Properties

Total

Fixtures,
Equipment
& Vehicles
£m

2,458
27
344
(68)
(9)

£m

4,878
12
470
(61)
(21)

Fixtures,
Equipment
& Vehicles
£m

1,762
(cid:209)
228
(24)

£m 

5,555
(cid:209)
566
(71)

£m

7,336
39
814
(129)
(30)

£m

3,793
(cid:209)
338
(47)

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
6,050
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

8,030

1,966

5,278

2,752

4,084

654
(9)
70
(9)
(6)

1,224
48
229
(60)
(4)

1,878
39
299
(69)
(10)

411
(cid:209)
36
(5)

863
(cid:209)
169
(16)

1,274
(cid:209)
205
(21)

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1,458
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

1,437

2,137

1,016

700

442

4,578

4,592
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
4,281
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

1,315

5,893

3,642

3,382

4,224

5,458

1,234

899

950

154
98

80
85

234
183

106
65

61
66

167
131

Cost or Valuation
At 10th March 1996
Adjustment (see below)
Additions (see below)
Disposals
Exchange adjustments

.   .   .   .   .   .
.   .   .   .   .
.   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .

At 8th March 1997 

.   .   .   .   .   .

Depreciation
At 10th March 1996
Adjustment (see below)
Provided in the period
Disposals
Exchange adjustments

.   .   .   .   .   .
.   .   .   .   .
.   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .

At 8th March 1997 

.   .   .   .   .   .

Net Book Value
At 8th March 1997 

.   .   .   .   .   .

At 9th March 1996

.   .   .   .   .   .

Capital Work-in-Progress 
included above
At 8th March 1997 
At 9th March 1996

.   .   .   .   .   .
.   .   .   .   .   .

The amount included in the additions of £814 million in respect of interest capitalised during the period ended 8th March 1997
was £6 million after deducting tax relief of £3 million (Company £4 million after deducting tax relief of £2 million).
Accumulated interest capitalised net of tax relief included in the cost or valuation total above amounts to £245 million (1996:
£241 million) for the Group, and £221 million (1996: £217 million) for the Company.

Included in the net book value of fixed assets for the Group is £84 million (1996: £84 million) for assets held under finance leas-
es, of which £79 million (1996: £75 million) relates to properties and £5 million (1996: £9 million) to fixtures.

The Group Adjustment relates to reclassifications within the fixed asset balances of Texas Homecare, as at the date of acquisi-
tion of that business, following further review during the period.

Analysis of Properties 
At 8th March 1997

Freehold:

Long leasehold: Cost

Short leasehold: Cost

Cost
1973 valuation
1992 valuation

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .

1973 valuation
1992 valuation

1992 valuation

Group

Company

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
Valuation
£m

Valuation
£m

Cost
£m
4,004

Cost
£m
3,371

2
65

4
22

511

110

2
63

4
22

670

510

1
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
92
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

5,184

3,992

94

1

16

J Sainsbury plc

If the properties included at valuation had been included at cost, the cost and accumulated depreciation figures at 
8th March 1997 would have been:—

Group

Company

Freehold .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Long leasehold .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Short leasehold .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Cost Depreciation
£m
417
114
159

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
Cost Depreciation
£m
331
83
18
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
432
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

£m
4,035
687
513

£m
3,399
528
113

5,235

4,040

690

Note 2 Fixed Asset Investments

Group

Company

Subsidiaries (Note 3) .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Associated Undertakings (Note 4)
.   .   .   .   .   .   .   .   .   .   .   .   .
Listed on a UK stock exchange
Listed on a US stock exchange
.   .   .   .   .   .   .   .   .   .   .   .   .
Other.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Other investments

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m
1,553
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

1997
£m
1,819

1996
£m

1997
£m

(cid:209)
(cid:209)
20

3
98
13

3
119
25

(cid:209)
(cid:209)
12
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
12
(cid:209)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1,565
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

147
1

114
3

1,839

20
(cid:209)

117

148

The decrease in Other investments represents disposals of £2 million.

Note 3 Investment in Subsidiaries

The Company(cid:213)s principal Subsidiaries are:—

Share of Ordinary
Allotted Capital

Sainsbury(cid:213)s Supermarkets Ltd.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Savacentre Limited*.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Homebase Limited*.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Shaw(cid:213)s Supermarkets, Inc.*.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
NewMarket Foods Limited.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
J Sainsbury Developments Limited .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Sainsbury(cid:213)s Bank plc.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

100%
100%
100%
100%
100%
100%
55%

*Shares are held by other Subsidiaries.

All Subsidiaries operate in the countries of their registration or incorporation.

Details of other Subsidiaries will be set out in the Company(cid:213)s Annual Return.

Summary of movements

Country of
Registration or
Incorporation
England
England
England
USA
England
England
England

Company
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
£m

Shares
At 10th March 1996.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Acquisitions and other additions.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

At 8th March 1997.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Long-term capital advances
At 10th March 1996.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Additions.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

At 8th March 1997.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Total Net Investment 8th March 1997.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

9th March 1996 .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

110
72
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
182
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

1,443
194
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1,637
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1,819
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  
1,553
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) 

Total net investment by the Company in Subsidiaries at 8th March 1997 consists of total cost of shares and capital advances of
£1,822 million (1996: £1,556 million) less £3 million (1996: £3 million) for cumulative amounts deducted from reserves.

J Sainsbury plc

17

Note 4 Investment in Associated Undertakings

The Company(cid:213)s principal Associated Undertakings are:—

Share of
Allotted
Capital

Share of Profit
before Tax

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m

1997
£m

Giant Food Inc. (Food Retailing — US)
125,000 Voting Common Stock of $1 each .   .   .   .   .   .   .   .   .   .   .
11,779,931 Non-Voting Common Stock of $1 each .   .   .   .   .   .   .   .
Breckland Farms Limited (Pig Farming — UK)
200,000 (cid:212)B(cid:213) Ordinary Shares of £1 each
141,532 1% Redeemable Preference Shares of £1 each
(other shareholder Pauls plc)
Hampden Group PLC (DIY Retailing — UK)
4,470,000 Ordinary Shares of 10p each

.   .   .   .   .   .   .   .   .   .   .   .

.   .   .   .   .

}

50%
19.8%

50%

29.7%

Summary of movements

17

1

18

1

1

(cid:209)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
19
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

19

Group

Company
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
£m

£m

Shares
At 10th March 1996.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Purchase of Giant Food Inc. shares (Note 5).   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Exchange adjustments.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

At 8th March 1997 .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Share of post acquisition reserves
At 10th March 1996.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Share of retained profit for the period .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .    .   .   .
Other adjustments to reserves (Note 15).   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

At 8th March 1997 .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

98
20
(5)

7
(cid:209)
(cid:209)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
7
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

113

10
6
5
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
21
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

Long-term capital advances
At 10th March 1996.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Additions in period.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

At 8th March 1997 .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Total Net Investment 8th March 1997.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

9th March 1996.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

13

6
7

5
8
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
13
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
20
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
12
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

114

147

The Group(cid:213)s investment in shares in Associated Undertakings at 8th March 1997 represented £265 million (1996: £224 mil-
lion) in respect of the cost of shares, less goodwill of £150 million set off against reserves (1996: £129 million), less accumulat-
ed exchange adjustments of £2 million (1996: additions of £3 million). The Company(cid:213)s investment in shares in Associated
Undertakings at 8th March 1997 represented cost of shares of £7 million (1996: £7 million).

At 8th March 1997 the market value of shares listed on a recognised US stock exchange was £241 million (1996: £206 million),
and on a recognised UK stock exchange £4 million (1996: £4 million).

The proportion of the profits of the Associated Undertakings attributable to the Group and the reserves included in the Group
Balance Sheet are taken from audited accounts produced within three months of the balance sheet date.

The investment in Breckland Farms Limited is held directly by J Sainsbury plc. Investments in Giant Food Inc. and Hampden
Group PLC are held by Subsidiaries. 

Giant Food Inc. has been classified as an Associated Undertaking in view of the proportion of voting stock held.

18

J Sainsbury plc

Note 5 Acquisitions of Subsidiaries and Associated Undertakings

5.1 Homebase 

In August 1996 the Company acquired the 25% minority interest in Homebase for a consideration of £65 million together with
fees and other costs. Goodwill of £54 million arising on the acquisition has been deducted from reserves. The assets and liabili-
ties of Homebase have not been revalued as in the opinion of the Directors the difference between fair values and carrying
amounts 
is not material.

The Group received £10 million from Ladbroke Group PLC following arbitration on the purchase price of Home Charm Group
PLC acquired in 1996. £9 million has been added to reserves and £1 million representing the interest on the award has been
included in the 1997 Profit and Loss Account.

5.2 Giant Food Inc.

The additional investment in Giant Food Inc. represents £41 million for the purchase of 2 million non-voting shares less £21 mil-
lion for goodwill which has been deducted from reserves. The Group(cid:213)s share of Giant Food Inc.(cid:213)s net tangible assets at the date
of acquisition has been increased by £2 million to reflect the Group(cid:213)s accounting policy for valuation of stock. No other fair
value adjustments have been made.

Note 6 Stocks

Group

Company

Goods for resale and consumable stores
Land held for development

.   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

1997
£m
689
55

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m
357
(cid:209)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
357
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

1996
£m
699
62

1997
£m
349
(cid:209)

349

744

761

Note 7 Debtors

Group

Company

Trade debtors.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Advance corporation tax recoverable in more than one year
.   .   .
Amounts owed by Subsidiaries .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .
Other debtors due in less than one year 
.   .   .   .   .   .   .   .   .   .
Other debtors due in more than one year 
Prepayments .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

1997
£m
73
40

1996
£m
52
40

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m
9
40
76
25
—
24
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
174
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

1997
£m
10
40
52
55
11
18

16
50
46

76
18
46

253

204

186

Note 8 Current Asset Investments

Group

Company

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m

1996
£m

1997
£m

1997
£m

Investments listed on a recognised stock exchange at cost
(equivalent to market value)

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

7

5

(cid:209)

(cid:209)

J Sainsbury plc

19

Note 9 Creditors

Group

Company

Due within one year:
Borrowings:
Bank loans and overdrafts .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Short-term notes.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
2% Bonds 1996 .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
81
9 1
8% Notes 1996 .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
6% Loan Stock.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Unsecured loan notes.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Current portion of long-term indebtedness including
obligations under finance leases .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Total short-term borrowings
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Trade creditors .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Amounts due to Subsidiaries .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Corporation tax .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Social security and other taxes .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Other creditors .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Accruals .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Proposed dividend .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Due after one year:
8 1

2% Convertible Capital Bonds 2005.   .   .   .   .   .   .   .   .   .   .   .   .

Other:
Secured loans .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Unsecured loan notes.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Term bank loans .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
4% Notes 2000 .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
8 1
.   .   .   .   .   .   .   .   .   .   .
8% Irredeemable Unsecured Loan Stock 
Obligations under finance leases 
.   .   .   .   .   .   .   .   .   .   .   .   .   .
Amounts due to Subsidiaries  .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Loan to Homebase Limited from minority shareholder
.   .   .   .   .
Other creditors  .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m

1996
£m

1997
£m

1997
£m

580
237
(cid:209)
(cid:209)
(cid:209)
115

531
53
98
98
18
3

535
237
(cid:209)
(cid:209)
(cid:209)
112

489
50
98
98
18
(cid:209)

(cid:209)

8

8

940
896

809
816

(cid:209)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
753
674
191
171
27
275
29
160
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
2,280
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

884
758
70
165
37
366
30
162

187
55
432
132
162

216
47
319
152
160

2,804

2,472

2,519

(cid:209)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

156

156

(cid:209)

2
319
(cid:209)
150
3
107

2
166
26
150
3
101

(cid:209)
279
(cid:209)
150
3
(cid:209)
283

(cid:209)
148
26
150
3
(cid:209)
156

(cid:209)
14

13
19

(cid:209)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
483
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

480

715

595

(cid:209)

2% Convertible Capital Bonds were issued by J Sainsbury (Channel Islands) Limited, and are guaranteed on a subordinated
The 81
basis by the Company. These bonds are convertible, at any time prior to November 2005, into 21
2% Exchangeable Redeemable
Preference Shares of the issuer which are exchangeable for ordinary shares in the Company at the prescribed price of 337p per
ordinary share (after adjustment to take account of the rights issue in July 1991). Alternatively, the bonds may be redeemed at
par on maturity. The issuer is entitled to redeem the bonds in certain circumstances or if 80% of the bonds have been converted
or redeemed. As at 8th March 1997 22% (£44 million) had been exchanged for ordinary shares in the Company.

The secured loans and £41 million of the unsecured loan notes comprise US dollar borrowings of an overseas Subsidiary.
Repayment and interest terms, which vary with each loan, require a combination of annual instalments and balloon repayments
with interest rates ranging from 4.8% to 10.375%.

Unsecured loan notes also include US $200 million (1), US $200 million (2) and £30 million Euro Medium Term Notes issued
by the Company. The £30 million Notes, which mature in April 2000, bear interest based on sterling LIBOR. The US $200 million
(1) Notes, which mature in December 1999 bear interest at 6.625% but interest on $150 million of this has been swapped into
floating rates based on US $ LIBOR. The US $200 million (2) Notes, which mature in March 2002 bear interest at 6.25%.

The £150 million Notes which are repayable in December 2000 bear interest at 8.25% but this has been swapped for a floating
rate based on sterling LIBOR.

Arrangements have been made to avoid exposure to fluctuating US dollar interest rates following maturity of US $150 million
Euro Medium Term Notes (included under Short Term Notes due within one year) by entering into a forward swap of floating
interest payments for fixed interest rate payments. A rate of 6.95% for US $150 million for five years starting in November
1997  has been contracted for.

Shortly after the year end the Company issued £200 million Euro Medium Term Notes replacing bank loans and overdrafts. The
£200 million Notes, which mature in June 2002, bear interest at 7.25%.

20

J Sainsbury plc

Note 10 Summary of Borrowings

Group

Company

Due within one year:

Bank and other loans .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Obligations under finance leases
.   .   .   .   .   .   .   .   .   .   .   .
Due after one and within two years:

Bank and other loans .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Obligations under finance leases
.   .   .   .   .   .   .   .   .   .   .   .
Due after two and within five years:

Bank and other loans
Obligations under finance leases

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .

Due after five years:

Bank and other loans .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .
Obligations under finance leases
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Convertible Capital Bonds

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m

1996
£m

1997
£m

1997
£m

932
8

28
5

318
11

801
8

163
5

193
10

884
(cid:209)

(cid:209)
(cid:209)

432
(cid:209)

753
(cid:209)

144
(cid:209)

180
(cid:209)

128
91
156

159
(cid:209)
(cid:209)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1,236
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

283
(cid:209)
(cid:209)

4
86
156

1,677

1,599

1,426

Note 11 Provisions for Liabilities and Charges

Group

Company

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
Deferred
Tax
£m 

Deferred
Tax
£m

Other
£m

Other
£m

Total
£m

Total
£m

At 10th March 1996 .   .   .   .  .   .   .   .   .   .   .   .
Profit and Loss Account

Property — provision released
Texas Homecare integration (see below)
Deferred tax — UK
Deferred tax — US

.   .   .   .   .   .   .
.   .
.   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .

Utilised.   .   .   .   .   .   .   .   .   .   .  .   .   .   .   .   .   .   .

At 8th March 1997 

.   .   .   .   .   .   .   .   .   .   .   .

54

86

(32)

(2)
50
8
6
(61)

(2)
50
(cid:209)
(cid:209)
(61)

(cid:209)
(cid:209)
8
6
(cid:209)

(cid:209)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
(cid:209)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)    

(18)

(2)

(2)

55

10

73

10

15

(2)

(1)

14

(2)

(cid:209)

1

(cid:209)

(1)

A further provision of £50 million has been made during the period to reflect the additional costs now envisaged for integrating
Texas Homecare into the Homebase Group. The provision comprises the costs of converting an additional 65 Texas Homecare
stores to the full Homebase format, the increased costs of each store conversion and additional costs of range and supply chain
integration.

The total of other provisions of £73 million consists of £9 million relating to unutilised provisions made in 1994 for losses on
realisation of surplus land and stores due for closure, £15 million representing the balance of the provision for store closure
costs of Texas Homecare and £49 million representing the provision for the integration costs of Texas Homecare. The provided
and unprovided liabilities for deferred tax are as follows:

Group

Company 

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

1997
Provided Unprovided
£m

£m

1996

Provided Unprovided 
£m

£m

1997
Provided Unprovided
£m

£m

1996

Provided Unprovided 
£m

£m

Timing differences
between 
depreciation and 
capital allowances
Other timing 
differences .   .   .   .   .   .

.   .   .

16

191

11

182

(cid:209)

163

(cid:209)

157

(34)

—
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
157
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(18)

163

196

(32)

(43)

187

(cid:209)

5

1

1

5

(cid:209)

(cid:209)

The potential liability for tax which might arise on disposal of the Group(cid:213)s properties has not been quantified. In the opinion of
the Directors the likelihood of any such liability arising is remote.

J Sainsbury plc

21

Note 12 Called Up Share Capital

Aggregate
Allotted
fully paid shares
Consideration
Nominal Value
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
£m

Number

£m

Ordinary shares of 25p each 

Authorised (cid:209) 2,000,000,000 shares

.   .   .   .   .   .   .   .   .   .   .   .

At 10th March 1996.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Shares allotted: 

1,831,667,605

500
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
458

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Profit sharing scheme
.   .   .   .   .   .   .   .   .   .   .   .
Savings-related share option scheme
Executive share option scheme
.   .   .   .   .   .   .   .   .   .   .   .   .   .
Share dividend alternative  .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

At 8th March 1997.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

100,266
5,050,478
493,373
2,719,093

1
13
1
10
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
25
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

1,840,030,815

(cid:209)
1
(cid:209)
1

460

2% Convertible Capital Bonds 2005

Contingent rights to the allotment of 46,277,448 ordinary shares in the Company at 337p (after adjustment to take account of
the rights issue in July 1991) exist until November 2005 under the terms of the issue of 81
(Note 9).
The Company operates a Savings-Related Share Option Scheme for all employees with more than one year(cid:213)s service. This is an
approved Inland Revenue Scheme and was established in 1980. The Scheme is renewable every 10 years and was last renewed
in 1996. Under the Savings-Related Share Option Scheme, options have normally been exercisable within six months of the fifth
anniversary of the grant of an option. In 1996, following government legislation the Company extended the Scheme to make
provision for the grant of options which are normally exercisable within 6 months of the third anniversary of such a grant. 
At 8th March 1997 employees held 77,952 five-year savings contracts in respect of options over 39.1 million shares and 12,048
three-year savings contracts in respect of options over 3 million shares.
The Company also operates an Executive Share Option Scheme for Executive Directors and senior employees. This is an
approved Inland Revenue Scheme and was established in 1984. The last grant of option under this scheme was in December
1995 and no further grants will be made, although options will remain exercisable until September 2005. An Inland Revenue
Approved Executive Share Option Scheme, an Unapproved Executive Share Option Scheme and a Long-Term Incentive Scheme
were established in 1996. Under the Executive Share Option Schemes options are normally exercisable between three and ten
years of the date of the grant of an option. At 8th March 1997 1,176 employees had outstanding options over 24.1 million
shares. No shares have been set aside for Directors under the Long-Term Incentive Scheme.
Details of these options at 8th March 1997 are set out below:—

(a)  Savings-Related Share Option Scheme

Price

Options outstanding at
the end of the period

Date of Grant
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
9th January 1990
19th December 1990.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
30th December 1991.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
4th December 1992 .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
6th December 1993 .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
16th December 1994.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
20th December 1995.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
11th December 1996 (3-year period).   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
11th December 1996 (5-year period).   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

pence
205.504
237.120
276.000
393.000
301.000
331.000
313.000
292.000
292.000

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
2,662
3,031,709
6,526,099
6,183,522
7,320,631
8,036,213
9,593,123
—
—
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
42,102,450
40,693,959
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

1997
(cid:209)
(cid:209)
3,980,736
5,610,787
6,670,749
7,230,956
8,945,512
2,958,668
6,705,042

(b)  Executive Share Option Scheme

Price

Options outstanding at
the end of the period

Date of Grant
14th July 1986
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
7th March 1987 .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
13th July 1987
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
9th February 1988.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
31st July 1989
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
28th February 1991.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
28th August 1992.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
12th March 1994 .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
8th September 1995.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
1st December 1995.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

pence
193.648
238.602
281.580
217.360
272.688
322.088
447.000
359.000
475.000
386.000

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
85,232
2,495
200,205
316,939
1,052,225
2,803,014
5,067,550
8,364,987
6,880,011
73,834
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
24,130,437
24,846,492
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

1997
(cid:209)
(cid:209)
124,680
268,896
909,048
2,656,083
5,033,569
8,282,035
6,782,292
73,834

Figures for all prices and options outstanding are adjusted as necessary for the capitalisation issue in July 1987 and for the rights 

22

J Sainsbury plc

Note 13 Share Premium Account

At 10th March 1996.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Profit sharing scheme.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Savings-related share option scheme.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Executive share option scheme.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Share dividend alternative .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .    .   .   .   .   .   .   .   .   .   .   .   .

At 8th March 1997.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Note 14 Revaluation Reserve

At 10th March 1996.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Transfer to Profit and Loss Account in respect of property disposals 
during the period and depreciation of revalued assets (Note 15) .   .   .   .   .   .   .   .   .   .   .   .   .   .

At 8th March 1997.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Note 15 Profit and Loss Account

Company
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
£m
1,074
1
12
1
9
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1,097
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

Group

Company
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
£m
44

£m
43

(10)

(10)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
34
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

33

Group

Company
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
£m
2,107
161

10

£m
1,959
177
(66)
10
(4)
5

At 10th March 1996.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Profit retained for the period.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Goodwill.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Transfer from Revaluation Reserve (Note 14).   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Currency movements.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Other (Note 4).   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

At 8th March 1997.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
2,278
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

2,081

The cumulative goodwill deducted from the reserves of the Group at 8th March 1997 amounted to £441 million 
(1996: £375 million).

The other credit of £5 million relates to the Group(cid:213)s share of adjustments to reserves made by Associated Undertakings.

No provision has been made for additional tax which would arise if profits of overseas Subsidiaries or Associated Undertakings
were distributed.

J Sainsbury plc

23

Note 16 Segmental Analysis of Turnover, Profit and Net Assets

Group
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

Turnover

Incl.
Taxes
£m

Excl.
Taxes
£m
.   .   .   . 11,586 10,852
Food retailing — UK
Food retailing — US
.   .   .   .
1,557
1,572
DIY retailing — UK .   .   .   .   .
966
1,134
Food manufacturing — UK .   .
129
129
Property development
and other — UK .   .   .   .   .   .
Banking — UK .   .   .   .   .   .   .

35
(cid:209)

4
(6)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

35
(cid:209)

Gross turnover
Intra-group sales** .   .   .   .   .

.   .   .   .   . 14,456 13,539
(144)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
.   .   .   .   . 14,312 13,395
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(144)

Group turnover

.   .   .
.   .   .   .   .   .

Group operating profit 
before profit sharing 
Profit sharing
Associated Undertakings
— share of profit
— net group investment
Profit/(loss) on 
sale of fixed assets .   .   .   .   .
.   .   .
Net interest payable

.   .   .   .   .
.   .

Group profit before tax

.   .

Capital employed .   .   .   .   .

Net borrowings .   .   .   .   .   .
Minority interest .   .   .   .   .   .

Net assets .   .   .   .   .   .   .   .

695
(37)

19

8
(76)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
609
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

1997

Profit
£m
693
41
(34)
(3)

Borrow-
ings* &
Net Minority
Interest
£m

Assets
£m
3,913
491
460
22

Turnover

Incl.
Taxes
£m
10,909
1,462
1,104
118

Excl.
Taxes
£m
10,214
1,449
940
118

1996

Profit
£m
779
51
(22)
(5)

Borrow-
ings &
Net Minority
Interest
£m

Assets
£m
3,839
437
320
17

78
10

147

30
—

114

19
—

19
—

3
—
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
12,740
13,612
(113)
(113)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
13,499
12,627
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

806
(50)

19

(4)
(59)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
712
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

5,121
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

4,757
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(1,445)
(5)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

3,671
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(1,212)
(11)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

3,534
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

Total administrative expenses amounted to £324 million (1996: £302 million) including provision for profit sharing. Total cost
of sales amounted to £12,413 million (1996: £11,569 million) including exceptional cost of sales.

Group financing is undertaken centrally and in consequence the Group(cid:213)s net interest payable has not been attributed to classes
of business or geographical areas. 

* Borrowings, including cash and current asset investments, exclude those of Banking — UK.

** Intra-group sales relate to Food retailing — UK, £33 million (1996: £10 million), Food manufacturing — UK, £102 million 
(1996: £95 million) and Property development and other — UK, £9 million (1996: £8 million).

Turnover is disclosed by origin. There is no material difference in turnover by destination.

Net margin on tax inclusive sales:*

Group
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996

1997

UK.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
US.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Net margin on tax exclusive sales:*

UK.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
US.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

5.53%
2.61%

6.67%
3.49%
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
6.33%
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

5.21%

5.95%
2.63%

7.18%
3.52%
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
6.76%
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

5.56%

*Based on Operating Profit before profit sharing and exceptional cost of sales, and sales excluding intra-group sales.

24

J Sainsbury plc

Note 17 Profit Sharing

The amount provided for profit sharing for UK retail companies is calculated on the operating profits and net interest reflected in
the accounts of the participating companies.

The figure on which the profit fund is based is £661 million (1996: £770 million). £34 million (1996: £47 million) has been
provided for the profit fund and £3 million (1996: £3 million) for Employers(cid:213) National Insurance.

Employees participate in the Profit Sharing Scheme after completing one financial year(cid:213)s service and obtain full benefits after the
third year. In respect of the period ended 8th March 1997 approximately 115,000 employees are eligible. A distribution rate is
calculated each period according to the size of the profit fund and the total qualifying pay of eligible employees and is finalised
following the Annual General Meeting. The distribution rate in 1997 is expected to be approximately 4.5% (1996: 7.1%).

Profit sharing may be taken in cash under the Cash Trust or, subject to the statutory maximum, in shares under the Share Trust.
The number of shares allotted to Profit Sharing Scheme participants in July 1996 is set out in Note 12.

At 8th March 1997 the Trustees of the J Sainsbury Profit Sharing Scheme Share Trust held 12 million shares (1996: 20 million)
on behalf of 39,854 participants (1996: 43,472) in the Scheme.

Note 18 Net Interest Payable

Interest receivable.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Interest payable:

Bank loans and overdrafts.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Other loans.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Finance leases.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Interest capitalised.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Net Interest Payable.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Group
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m
9
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

1997
£m
18

19
73
12

8
65
9
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
82
(14)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
68
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
59
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

104
(10)

76

94

Note 19 Profit on Ordinary Activities before Tax

This has been arrived at after charging/(crediting):

Group
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m

1997
£m

Depreciation — owned assets.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
— finance leases.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Pension costs.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Auditors(cid:213) remuneration — audit fee (Company £0.2 million (1996: £0.2 million)) .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
— other.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
— receivable.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Operating lease rentals — plant and equipment

— other services (see below)

291
8
48

0.5
0.8

11
210
(21)

270
8
42

0.5
0.6

11
194
(19)

The Auditors(cid:213) remuneration for other services relates to taxation and VAT advice (£0.4 million), together with other general
consultancy and advisory work (£0.4 million). In addition to the amounts shown above, fees of £0.5 million have been paid dur-
ing the period to the Company(cid:213)s Auditors, Coopers & Lybrand, in connection with the expert determination resulting from the
acquisition of Texas Homecare. This has been added to the cost of the investment.

Note 20 Directors(cid:213) Emoluments and Interests

The details of Directors(cid:213) emoluments and interests are set out in the Report of the Remuneration Committee on pages 5 to 8.

J Sainsbury plc

25

Note 21 Employees

Group
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m

1997
£m

Employees(cid:213) remuneration and related costs during the period amounted to:
Wages and salaries.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Social security costs.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Other pension costs.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Profit sharing.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

The average number of employees during the period was:
Full-time.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Part-time.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Full-time equivalent.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

1,374
85
48

1,236
77
42
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1,355

1,507

37

50
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1,405
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

1,544

1997
Number

1996
Number

53,304
112,688

49,764
104,897
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
154,661
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  
95,519
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

102,544

165,992

Note 22 Tax on Profit on Ordinary Activities

Group
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m

1997
£m

The tax charge based on the profit for the period is:
Corporation tax at 33% (1996: 33%).   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Deferred tax.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Overseas tax — current.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Share of Associated Undertakings(cid:213) tax.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

177
14
9
8

211
3
12
8
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
234
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

208

Note 23 Dividends

Company
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m

1997
£m

Interim.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Proposed final.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

64
162

62
160
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
222
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

226

The interim dividend of 3.5p per share paid on 15th January 1997, together with the related tax credit, is equal to 4.375p and
the proposed final dividend of 8.8p per share, together with the related tax credit, is equal to 11.0p.

Note 24 Earnings Per Share

The calculation of earnings per share is based on profit after tax and minority interest, divided by the weighted average number
of ordinary shares in issue during the period of 1,835,190,739 (1996: 1,817,446,080).

The calculation of fully diluted earnings per ordinary share is based on the profit after tax and minority interest and adjustments
which assume:

i)

ii)

the full conversion of Convertible Capital Bonds on the first day of the financial year; and

the full exercise of all ordinary share options granted under the Company(cid:213)s own schemes on the first day of the financial year,
or the date granted if later.

The adjusted weighted average number of ordinary shares arising from these calculations totalled 1,945,233,840 (1996:
1,933,046,030).

The alternative measures of earnings per share provided reflect the Group(cid:213)s underlying trading performance by excluding the
effect of the exceptional cost of sales and the profit or loss on the sale of fixed assets and taking account of anticipated future
dilution of earnings per share.

26

J Sainsbury plc

Note 25 Reconciliation of Operating Profit to Net Cash Inflow from Operating Activities

Operating profit before profit sharing.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Profit sharing.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Provision for exceptional cost of sales.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Depreciation.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Loss on sales of fixtures, equipment and vehicles .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Release of provision.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Decrease/(increase) in stocks.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Increase/(decrease) in debtors.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Increase in creditors.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Net cash inflow from operating activities before payment against provisions
.   .   .   .   .   .   .   .
Payment against exceptional provisions (see below) .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Net cash inflow from operating activities.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

1997
£m
695
(37)
50
299
(cid:209)
(2)
8
(23)
156

Group
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m
806
(50)
48
270
3
(3)
(103)
24
38
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1,033
(21)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1,012
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)  

1,146
(61)

1,085

The payment against exceptional provisions consists of £3 million relating to the provision raised in 1994 for losses on realisa-
tion of surplus land and stores due for closure, £14 million relating to the provision for store closure costs made prior to the
acquisition of Texas Homecare in 1996, £43 million relating to the provision for integration costs of Texas Homecare made in
1996 and £1 million relating to the additional provision for integrating Texas Homecare made during 1997.

Note 26 Analysis of Net Debt

Cash in hand, at bank
.   .   .   .   .   .   .   .   .   .   .   .
Overdrafts .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

At
10th March
1996
£m
209
(240)

Other
non-cash

Cash
Exchange
flow movements movements
£m
£m
£m
(3)
35
4
114
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
149

At
8th March
1997
£m
241
(122)

Debt due within 1 year .   .   .   .   .   .   .   .   .   .   .   .
Debt due after 1 year .   .   .   .   .   .   .   .   .   .   .   .   .
Finance leases.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

(561)
(516)
(109)

(143)
143
(13)

18
3
4

(810)
(630)
(115)

(124)
(260)
3
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
(381)

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
(1,436)
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)

(1,217)

(232)

(13)

26

Note 27 Future Capital Expenditure

Group

Company

Contracted for but not provided for in the accounts

.   .   .   .   .   .

Note 28 Contingent Liabilities and Financial Commitments

(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
1996
£m
236

1997
£m
245

1997
£m
214

1996
£m
247

The Company has guaranteed borrowing facilities for Associated Undertakings to the extent of £1 million (1996: £1 million).

The Company has guaranteed the borrowings of Subsidiaries which, at 8th March 1997, amounted to £156 million 
(1996: £156 million).

Commitments to make operating lease payments during the next financial year are as follows:

Group

Company
(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209) (cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)(cid:209)
£m

£m

Land and Buildings

Leases which expire between 1 and 5 years
.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .
Leases which expire after 5 years.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

Other Leases

Leases which expire between 1 and 5 years

.   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .

3
211

11

1
99

7

J Sainsbury plc

27

Note 29 Pension Commitments

The Group operates final salary pension schemes in the UK. The costs are assessed on the advice of independent qualified actuar-
ies.

Of the total pension costs of the Group, £40 million (1996: £35 million) relates to the UK Schemes, namely the J Sainsbury
Pension and Death Benefit Scheme (JSPDBS) and the J Sainsbury Executive Pension Scheme (JSEPS). The assets of the UK Schemes
are held by trustee companies which are separate from the Company.

The latest actuarial valuation of the UK Schemes was carried out by the actuaries as at 12th March 1994, using the projected 
unit method. The significant actuarial valuation assumptions used were that future investment returns would be 8 1
long-term future salary and wage increases would average 5 1

2% per annum and pensions would increase at 4% per annum. 

2% per annum,

At the date of the latest valuation the market value of the assets of the UK Scheme was £1,435 million and the actuarial value
of the assets was sufficient to cover 122% of the JSPDBS and 120% of the JSEPS benefits that had accrued to members, allowing
for expected future increases in earnings. 

The ongoing pension cost in respect of the UK Schemes, incorporating the amortisation of the surplus from the last valuation in
1991, has been adjusted to reflect the revised surplus arising from the March 1994 valuation and the net reduced surplus is
being amortised by a method which causes the Company(cid:213)s funding rate to rise from the current, abated level up to the full regu-
lar cost on a sliding scale over a period of 14 years for JSPDBS and 12 years for JSEPS.

Triennial valuations of the schemes are currently being undertaken as at 8th March 1997 and the results will be known in the
next financial year.

The Group also operates a final salary pension scheme in the US. The pension cost relating to the US benefit scheme has been
determined with the advice of independent actuaries. The charge to the Profit and Loss Account is calculated in accordance with
US accounting principles but would not have been materially different had UK accounting principles been applied.

Note 30 Related Party Transactions

There were no material transactions by the Company or the Group with related parties.

Note 31 Post Balance Sheet Event

Immediately after the year end the Company transferred net assets amounting to £3,935 million to a new Subsidiary, Sainsbury(cid:213)s
Supermarkets Ltd, in exchange for shares and loans.

28

J Sainsbury plc