Sainsbury results disappoint shareholders

Supermarket chain J Sainsbury said third quarter UK sales growth rose just 0.1% as it invested in new computer systems and distribution centres.

Britain's largest retailer after Tesco and Asda operates the chain of about 500 stores throughout Britain as well as more than 55 convenience stores. The company also owns 55% of Sainsbury's bank, a joint venture with Scottish bank HBOS.

The US arm of the group runs about 185 Shaw's supermarkets and the New England Star Market chain.

Sainsbury's said its decision to overhaul its distribution side had been impacting on sales.

Like-for-like sales grew 2% for the four weeks to January 3, most notably from its core food ranges, and the group stated that it is confident for long-term growth.

Total sales rose 1.8% after sales were affected by systems changes, the revamping of new automated distribution centres and the introduction of non-food ranges, Sainsbury said.

Sainsbury's said sales in the crucial seven days before Christmas had been particularly strong with 43 stores taking more than £2m (€2.88m).