Sainsbury’s Egypt woes should be removed soon; says CFO

The dramatic legal woes of J Sainsbury’s chief executive, Mike Coupe, in Egypt are an issue “we think we will remove in the not-too-distant future,” says John Rogers, the U.K. retailer’s chief financial officer.

“This is an ongoing legal dispute which relates to a matter when neither Mike nor I was working at the company,” he told CNBC Wednesday.

It emerged just last week that Coupe had been given a two-year jail sentence, in his absence, over charges that he tried to seize cheques from an Egyptian who was formerly in business with Sainsbury’s.

The bizarre dispute is not Sainsbury’s only problem at the moment. The supermarket chain booked a £72 million ($110 million) net loss for the year to March 14 on Wednesday, after taking a £900 million hit to the value of its property portfolio. Its underlying pre-tax profit was £681 million for the year.

“We see our store portfolio as being a big advantage – an asset, not a liability,” Rogers said.

“We’ve got a relatively small land bank compared to our listed peers.”

The big U.K. supermarkets are all facing the question of what to do with their substantial property portfolios, acquired in the days when large out-of-town supermarkets appeared to be the future of retailing. Now, customers are often moving online.

Food price deflation and changing consumer habits are challenges to retailers too.

While the U.K. economy has recovered slowly from the recession, Rogers confirmed that the supermarket had “yet to see.. consumer confidence translating into the retail sector.”

Source: CNBC