UK grocery sales growth slows in June as wet weather weighs, says NIQ

UK supermarket sales up 1.1% in 4 weeks to June 15 -NIQ

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Same period last year benefited from heatwave, high inflation

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Ocado again the fastest growing grocer

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Asda remains the industry laggard

By James Davey

LONDON, June 27 (Reuters) - Sales growth at British supermarkets slowed in June, reflecting wet weather, strength in sales last year and lower food inflation, industry data showed on Thursday.

Market researcher NIQ said sales at UK supermarkets rose 1.1% in the four weeks to June 15 year-on-year, versus growth of 3.3% in its May report and of 12.1% in the same period last year when Britain enjoyed an early June heatwave.

The data is the most up to date snapshot of UK consumer behaviour ahead of the July 4 national election.

This time last year UK food inflation had just peaked at 14.6%. It was 3.2% in May this year, according to NIQ.

Overall British retail sales also softened this month after a recovery in May, and stores expect another drop next month, a survey from the Confederation of British Industry showed on Wednesday.

NIQ said the wet weather meant shoppers were more inclined to shop for groceries online rather than in stores. In the four-week period in-store sales fell 0.9%, while online sales increased 3.7%, boosting the online channel's share of the grocery market to 12.6%, up from 12.2% a year ago.

The market researcher highlighted strong sales of warming foods, with gravy and stock sales up 28% and soup sales up 21%.

"We remain hopeful that current warm weather and England’s success at the Euros (soccer championship) may boost sales of drinks and snacks," Mike Watkins, NIQ’s UK head of retailer and business insight, said.

Echoing data from rival market researcher Kantar last week, NIQ said online supermarket Ocado remained Britain's fastest growing grocer with sales up 12.6% in the 12 weeks to June 15 year-on-year, ahead of discounter Lidl with growth of 8.0% and Marks & Spencer with growth of 7.1%.

Market leader Tesco had sales growth of 4.1%, with No.2 Sainsbury's seeing growth of 4.7%.

No. 3 Asda was again the industry laggard with sales falling 4.9% and its market share down a whole percentage point year-on-year.

Sales at No. 5 Morrisons rose 1.4%, but they fell 1.0% at discounter Aldi, the No. 4 player. (Reporting by James Davey; Editing by Emelia Sithole-Matarise)