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Last Updated: Thursday, 12 January 2006, 08:59 GMT
Sainsbury's sales beat forecasts
Sainsbury's tills
Sainsbury's says its focus is improving the shopping experience
Sainsbury's, the UK's third-largest supermarket chain, has announced better-than-expected sales in the run up to Christmas.

Like-for-like sales rose by 5.2%, excluding fuel, in the 12 weeks to 31 December, its fourth consecutive quarter of sales growth.

Same-store sales including fuel rose 4.8% in the quarter.

The company said its sales growth "reflects the progress made in this first year of our recovery plans".

Shares in Sainsbury have outperformed market leader Tesco by 20% during the past year.

During the week before Christmas, Sainsbury's said it served more than 19 million customers: the highest number of people through its tills ever in a single week.

"We prepared for Christmas well, developed outstanding seasonal products, strengthened promotional activity and worked hard to deliver great availability," said chief executive Justin King.

Market share

The trading update follows latest figures from market research TNS, which noted that Sainsbury's had taken its largest share of the market for two years.

The customer experience is much improved, but we still need to achieve this at a more acceptable cost
Justin King, chief executive

Rival Asda recently admitted that Sainsbury was likely to regain the second spot in UK market share in the spring.

Meanwhile, the supermarket noted a huge rise in online business. Sales over the internet grew by almost 30% in the three months leading up to Christmas, it said.

Sainsbury's now controls 16.2% of the grocery market, compared with 15.9% a year ago.

Now 15 months into chief executive Justin King's "Making Sainsbury's Great Again" recovery plan, he conceded that there was still more work to do.

"The customer experience is much improved, but we still need to achieve this at a more acceptable cost," Mr King said.

"We expect the market to remain highly competitive during quarter four."

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