Sainsbury's warns "very competitive" market here to stay

Chief executive Justin King said it had delivered a “good sales performance in a tough consumer environment”.

The retailer said escalating fuel prices continue to impact customers’ disposable income and put pressure on household budgets.

King said: “We expect the market environment to remain very competitive for the foreseeable future but we are confident in our ability to grow by doing a great job for our customers.”

The supermarket’s first half like-for-likes are also up 1.9%, excluding fuel, with total sales rising 4.3%.

The retailer launched its ‘Live Well For Less’ strapline during the quarter which King said re-affirmed its commitment to providing quality products at great prices.

In food, King said the grocer’s relaunched ‘by Sainsbury’s’ range was proving “extremely popular” and its premium ‘Taste the Difference’ and economy ‘basics’ range both saw strong growth.

The retailer’s general merchandise and clothing businesses continued to grow, with sales growth “well ahead” of its grocery business.

Its back-to-school sales were up almost 40% on last year and it is launching its Gok Wan womenswear collection in 200 stores tomorrow.

Sainsbury’s convenience business continued to grow at 20% as it opened 24 new stores during the quarter. The grocer added 390,000 sq ft of gross new space over the quarter.