09/05/2012 04:24 BST | Updated 09/05/2012 05:30 BST

Sainsbury's Profits Increase 7.1%

Sainsbury's celebrated a larger than expected profit rise this year, which the store attributed to its price-matching scheme.

With over 1,000 stores in the UK Sainsbury's is the third-largest supermarket in the UK.

The group said underlying profits increased 7.1% to £712 million in the year to March 17, beating City forecasts for a 5% rise.

Overall, sales excluding VAT rose 5.6% to £22.3 billion, taking its market share to the highest level for nearly a decade at 16.6%. It was helped by its Brand Match price scheme, which guarantees to match Asda and Tesco on 14,000 branded goods.

However, the chain, which opened 73 Local convenience stores last year as part of 1.4 million sq ft of new space, said it will slow its rate of store expansion from just over 7% to about 5% in the current financial year.

The group's profits growth represents a slowdown on the 9% increase a year ago but is still much better than Tesco, which recently suffered its first fall in UK profits for 20 years.

Chief executive Justin King said: "We are succeeding by understanding what our customers want, supporting and inspiring them to Live Well For Less."

Chairman David Tyler said the results represented a good sales and profit performance.

The group has seen strong growth in its own-label ranges, with its premium Taste The Difference lines up 8.2%.

Its Basics range grew 6.8%, driven by sales of store cupboard essentials and ingredients for cooking, making it the second biggest supermarket value brand, it claimed.

Internet business grew 20%, making Sainsbury's the fastest growing online food retailer, with sales of £800 million, while its convenience store business is also growing ahead of the market.