Iceland to Open 40 New Stores in Continued Budget Offensive

Iceland is to reinforce its attack on mid-market retailing rivals with plans to open 40 new stores in the current year, according to its latest results statement.

Iceland's total sales were up 2.7% to reach £2.7bn (€3.4bn, $4.6bn). In addition it opened 46 new stores in the fiscal year that ended 28 March, creating 1,500 jobs in the process.

Budget stores such as Iceland, Aldi and Lidl have been eating into the market share of Morrisons, Asda, Sainsbury's and especially Tesco.

"The UK food retail market is undergoing a period of major change, characterised by very strong growth by the hard discounters at one end of the market, and good progress by more upmarket specialists at the other," said Iceland.

Meanwhile, the mid-market supermarkets have struggled, with Tesco's quarterly sales down 3.7% amid tough competition.

Iceland, by contrast, is on a roll: "During the year we expect to open up to 40 new Iceland stores in the UK, creating up to 1,250 jobs, and to complete the rollout of our online service nationwide," it said.

High-end stores such as Waitrose have also done well of late. The John Lewis Partnership-run store retained about 5% of market share.