LONDON, Nov 7 (Reuters) - British supermarket group Sainsbury's expects to trade well in the run-up to Christmas but fears a consumer hangover in the new year if Brexit is unresolved, its boss said on Thursday. Prime Minister Boris Johnson has called an election for December 12 having claiming parliament has blocked his efforts to secure a deal with the European Union, despite the fact MPs actually voted in favour of giving his proposals further scrutiny.
The profit fall of Sainsbury comes when the group tries to regain confidence in the strategy.
The 150-year-old group did, however, forecast that the second-half profits would benefit from the annualisation of last year's staff wage increase and normalisation of marketing costs and weather comparatives.
In September, Coupe put cost-cutting and paying off debt at the heart of a new plan created to show Sainsbury's can prosper on its own.
J Sainsbury PLC (LON:SBRY) has reported a sharp decline in sales and profits for the first half of the year, as expected.
The group made an underlying pretax profit of 238 million pounds in the 28 weeks to September 21 - ahead of analysts' average forecast of 232 million pounds but down from 279 million pounds made in the same period past year.
Even if one-off costs are excluded, profits fell 15% to £238m as sales slipped by 0.2% to £16.8bn.
It has said it will close up to 15 large supermarkets, up to 40 convenience stores and up to 70 Argos stores.
Mike Coupe, chief executive of the leading United Kingdom supermarket group (SBRY.L), also warned Brexit uncertainty "weighs heavily" on its customers and said election day would hit supermarket sales.
Chief executive Mike Coupe said: 'We have created positive momentum across the business through strategic investments in our customer offer.
The company said that underlying profit-the company's preferred metric which excludes exceptional costs-was GBP238 million, a fall of GBP41 million from the prior year's period.
Net debt reduced by £568m to £6.7bn, reflecting strong cash generation. "In the meantime, however, Sainsbury remains somewhat under the cosh".
"We've had good news from M&S' food business this week, and its deal with Ocado will just add more pressure into the mix. The integration of Argos has been a step in a new direction, but despite the cross-selling potential, it hasn't been enough to boost overall sales".