P202 CEEFAX 2 202 Fri 24 Jan 21:12/31
    
    
  
 C TZ LEFT RIEL NG BY SAINSBURZ W   1/2 
  h  C                  e               
 issued a shock profits warning.        
                                        
 Its share price fell nearly 13.5% on   
 the news that 1996-7 profits would bj  
 between £640m and £650m — against      
 forecasts of £725m.                    
                                        
 The group, whose 4.4* pre-Christmas    
 sales growth exceeded City             
 expectations, also made a £50m         
 provision for the integration of Texas.
                                        
 Food rijail analyst Nick Bubb s id the 
 warning and provisjo. for Texas were   
 un eli vbbli. "Th y wet  a huge  hock."
                                        
   Thu price of customjt loyalty  >>>   
   Headlines 200       Commodities 246  
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   P202 CJJFAX 2 202 Fri 24 Jan 21:16/42
    
     s{5 
  
                                        
 City analysts are qujstionin  the value
 of customer reward schemes in the wake 
 of Sainsbury's shock profits warning.  
                                        
 The group predicts earnings well below 
 City expectations, at around £650m,    
 with sbliu growth around 7% compbred   
 with 13  at Tesfo.                     
                                        
 Many analysts believe Rrward and Extra 
 Reward are at the root of the problem. 
                                        
 One sbid: "This profits warning proves 
    t       ur           tr     to      
 sblis growth at some considerable      
 cost."                                 
                                        
   Sainsbury warning shocks City >>>    
   Headlin s 200       Commoditie  246  
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   P202 CJJFAX v@4p2  ti 24 Tbn 22:puO28
    
     p 5 5 s j jw1oz:%s{5 
 U]]]
                                        
 City tnklysts@ace qe!rtjonv@w th bvalue
 of customer reward@schUmes im the waSj 
@#M VaR-6Djr{.k@wP#cW@pt#VStg oAjMiNn. @
G    Rp   pp                 p          
      ro   p     t  j        w  l b lo  
 City expectations, at around £650m,    
 wiuhhsbliu growth aroynd 7* compared   
Gwijh 15% at Teuco.                 
          h                             
 Manz0bnalysts bjlienj Reward(and(Extra 
FRrward0arj Qt the@root0wf 
 a @  @ @@ h@ @       @@   @d    @   @  
 One saiE: "This profits warning proves 
 thbtaSajnsbury hbs bee- ttyYnF to "uy  
 sbleuTorowtUQctQwo#j)constjjrafliQTRhdT
 cost."                                 
a          h @    @@       @@      @   @
   Sainsbury warning shocks City >>>    
                                        
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