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LONDON - The U.K.'s Sainsbury said in the 12 months to March, pre-tax profits before one-off items were up 14 percent to 627 million pounds ($915.7 million), the BBC reports.
Chief executive Sir Peter Davis, who was brought in to turn the company around, told BBC Radio 4's Today program, "Things are getting better. Our service in the stores is getting better, the range is getting better, and as a result our profits are improving."
Sir Peter said that although Sainsbury was trying to close the gap with Tesco, it was not aiming to knock its bigger rival off the number one spot.
"They have got considerably more stores and more square footage, so I think it's highly unlikely that we'll catch them up in those terms," he said.
Sales at Sainsbury stores open for at least a year rose by 6.3 percent for the 12 months to the end of March, excluding petrol sales.
But the company said that sales growth had slowed in the past couple of months, because of the rapid progress it made this time last year when the recovery program began to take effect.
Sainsbury, like its rivals Tesco and Asda, is also concentrating on areas outside food.
The company said it was developing its clothes, home and beauty ranges.
Dow Jones reports that Sainsbury's plans to take on its competitors with a new "good value" format of up to 90 stores aimed at young families.
The stores will contain larger non-food ranges than the average Sainsbury's and will launch under the grocer's Savacentre brand, according to Dow Jones.
The "Broad Appeal" stores, as they are known internally, will largely be based in the Midlands and the north of England, the traditional strongholds of Asda and Tesco.