UK supermarket group Sainsbury's said today up to 3,500 jobs were at risk in a restructuring that will see it close 420 standalone Argos stores and shut down all in-store meat, fish and deli counters. 

Sainsbury's said it aimed to find alternative roles for as many impacted employees as possible, pointing out it had hired 52,000 since March. 

The group reported a loss before tax of £137m for the 28 weeks to September 19.

This reflected £438m of one-off costs associated with the Argos closures and other strategic changes introduced by Simon Roberts, who succeeded Mike Coupe as chief executive in June. 

He plans to refocus on Sainsbury's core food business, lowering prices, accelerating food innovation and growing online grocery services. 

Argos has around 40 stores here and as yet there are no indications as to whether any stores here will be affected.

Simon Roberts also wants to increase the rate of new convenience store and neighbourhood hub openings over the next three years. 

"We will put food back at the heart of Sainsbury's," he said. 

"Our other brands - Argos, Habitat, Tu, Nectar and Sainsbury's Bank - must deliver for their customers and for our shareholders in their own right," he added. 

Sainsbury's said its underlying pretax profit came to £301m. That was ahead of analysts' average forecast of £275m and £238m made the same time last year, as strong sales during the Covid-19 pandemic outweighed extra costs and losses at Sainsbury's Bank. 

First half like-for-like retail sales rose 6.9%, having been up 8.2% in the first quarter. 

Sainsbury's said it expected its new plan to drive an inflection in underlying profit momentum.

It said its pretax profit in the year to March 2022 is forecast to exceed that reported in the year to March 2020, which was not impacted by Covid-19.

Sainsbury's also said today that without clarity on Northern Ireland's trading status after the end of Britain's Brexit transition period on December 31 its stores there could see reduced product ranges. 

"The impact on Northern Ireland if we don't see that clarity is we will see restrictions in the range of products we can send to Northern Ireland stores," the supermarket chief executive Simon Roberts told reporters.

"There's a wide range of restricted products that until we get clarity would be at risk that we would n't be able to make available until something changes," he said.

Roberts said meat, fish and dairy products would all be impacted.

Sainsbury's has 13 stores in Northern Ireland.

Argos closures

In a statement, a spokesperson for Sainsbury's said the group was in the process of reviewing its estate and that a list of the Argos stores marked for closure had not yet been released.

However, the statement appeared to indicate that the closures would be confined to the UK market.

"We have said that we will close around 420 branches, bringing the UK Argos standalone store estate to around 100 by March 2024," the spokesperson said.

The statement clarified that 120 Argos 'standalone' stores had not reopened since they were closed in March due to the pandemic.

These stores will now remain closed permanently.

A further 300 stores will close by March 2024 and the group is in the process of reviewing its estate.

Sainsbury's plans to open 350 more Argos stores and collection points within its supermarkets and convenience stores in that time.

"Over the next three years we will make Argos a simpler, more efficient and more profitable business while still offering customers great convenience and value and improving availability," Simon Roberts, Chief Executive of J Sainsbury plc said.

"We are talking to colleagues today about where the changes we are announcing in Argos standalone stores impact their roles. We will work really hard to find alternative roles for as many of these colleagues as possible and expect to be able to offer alternative roles for the majority of impacted colleagues."