British supermarket group, Sainsbury's has reported retail underlying operating profit of £503 million (€604,70), up 3.7%, in its half year results published on Thursday.
Grocery volume growth at Sainsbury's and Nectar was partially offset by a lower Argos contribution.
Sainsbury's sales (excluding fuel) were up 4.6%, with grocery sales growth of 5.0% and Sainsbury's general merchandise and clothing sales decline of (1.5)%.
Argos sales were down (5.0)% and fuel sales down (4.4)%, while like-for-like retail sales (excluding fuel) were up 3.4% (Q1 2.7%, Q2 4.2%).
Private Label Growth
Simon Roberts, Chief Executive of J Sainsbury plc, said, "Our food business is going from strength to strength and we're making the biggest market share gains in the industry, with continued strong volume growth.
"More and more customers are coming to us for their big food shop, recognising our winning combination of value, quality and service.
"Reflecting our leading quality, more customers are choosing 'Taste the Difference', with sales up 18 per cent, the strongest premium private label growth in the market.
"And with the biggest ever increase in customers' value perception, we're outperforming the market across the whole basket, particularly in core fresh food categories.
Argos Tough Quarter
"Our grocery volume growth has delivered strong profit leverage at Sainsbury's, partially offset by a tough first quarter at Argos.
"Argos trading has improved through the second quarter and in more recent weeks, so we continue to expect to deliver strong retail underlying operating profit growth and free cash flow generation for the full year."
Sainsbury's said it intended to bring the grocery store to more locations, including the recent acquisition of eleven Homebase and two Co-op stores.
