Loblaw reported that net income soared 19.3% to C$550m (£309m) for the financial year to January 2, 2010.

Total sales declined 0.2% to C$30.8bn (£17.3bn) while same-store sales slid 1.1%.

Executive chairman Galen Weston said: “As we enter 2010 we continue to expect sales and margins to be challenged by deflation and increased competitive intensity.”

In the fourth quarter, sales growth was flat in food, moderate in pharmacy and strong in clothing. Sales of other general merchandise declined significantly due to lower discretionary consumer spending and reductions in the assortment.