Sainsbury's sees sales drop once more as price war rages

Struggling supermarket chain Sainsbury's has once again seen its like-for-like sales drop in its fourth quarter results, making it a full year of declining transactions.

Sales fell by 3.9% for retail sales including fuel in the 10 weeks leading to 14 March, and overall for the full year they have dropped by 3.6% on a like-for-like basis.

Sainsbury's chief executive Mike Coupe said: "We expect the market to remain challenging for the foreseeable future. Food deflation is likely to persist for the rest of this calendar year, and competitive pressures on price will continue."

In its role in the supermarket price wars, Sainsbury's has discounted 1,100 which has contributed to the 1.6% deflation that the supermarkets have experienced, according to Kantar Worldpanel's latest review of the sector.

However, convenience store sales, which is becoming a more important aspect for the nation's top grocers, were up by 14% for Sainsbury's.

Sainsbury's like-for-like sales excluding fuel were down 1.9%. The figures mean Sainsbury's is actually selling larger volumes of products but at lower prices, which is good news for consumers, but not so great for the bottom line.

Shares in the firm remained relatively unchanged following the results statement, dropping by less than 1% to 266.53p.