Sainsbury's raises profit forecast after enjoying record Christmas

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Shares were up more than 2% in early trading.

"With a good store mix and offer, Sainsbury's have some resilience in a tough market place and are well placed for the year ahead".

United Kingdom supermarket Sainsbury's has reported impressive online grocery sales and a "stellar growth in Argos Fast Track delivery and collection" in its third quarter trading statement. Of these, 18 replaced an existing Argos store. During the quarter to 6 January, Argos Fast Track collection grew by 39 per cent and delivery by 25 per cent.

Sainsbury's said in a statement that such services "were particularly popular" during Black Friday and the last few days leading up to Christmas.

While third quarter sales in General Merchandise dipped 1.4% and Clothing growth slowed from 6.3% in Q2 to just 1%, both are said to have outperformed their markets.

The grocer has so far covered this impact of inflation itself, according to the CEO, and said it will do what it can to reduce the impact of higher prices on its customers.

"We have to acknowledge the fact that the (non-food) market is challenging and there's certainly a little bit of a squeeze on consumer disposable income and where people are able to defer purchases they do", Chief Executive Mike Coupe told reporters.

The group said that grocery sales were up 2.3% during the period, however its online grocery (+8.2%) and convenience (+7.2%) posted impressive sales increases.

Separate industry data from Kantar Worldpanel showed shoppers spent £1bn more on grocery shopping in the last three months of 2017 compared to the year before - with Tesco seeing the best growth among the major supermarkets.

"We had a strong Christmas week, with record sales, over 340,000 online grocery orders and stellar growth in Argos Fast Track delivery and collection".

He added: "We delivered an excellent operational performance across the group, with great availability, strong customer satisfaction scores and our lowest level of waste ever at Christmas". Friday 22 December was the retailer's busiest day for sales and on that day Sainsbury's delivered an online grocery order to a customer every second.

The supermarket's Taste the Difference range performed particularly well, with customers buying more food from the premium range than past year.

Sainsbury's now has a 16.2 per cent share of the overall United Kingdom grocery market, according to analytics firm Kantar Worldpanel, behind Tesco but ahead of Asda and Morrisons.