Sainsbury’s has revealed a 5.3% increase in pre-tax profits to £758m for the year to 15 March.

While group sales increased 2.8% to £26.3bn, like-for-like sales were up just 0.2%.

The retailer said its own-brand ranges, basics and Taste the Difference, were giving it “a clear competitive advantage”, with own-brand growing at over twice the rate of branded goods in both sales and volumes. The relaunched ‘by Sainsbury’s’ range now has more than 7,000 lines while Taste the Difference is showing double-digit growth and has achieved more than £1.1bn in annual sales. It said 97% of customers were buying own-brand products.

Its convenience stores saw sales growth of around 19% following a focus on “great locations and fresh food”, and accounts for around a third of Britain’s convenience market growth.

General merchandise and clothing sales are increasing at more than twice the rate of food.

"Competitive retail environment"

Justin King, chief executive, said: “In a competitive retail environment we have focused on delivering high-quality, affordable own-brand products across all our channels, helping customers to Live Well for Less.

“While the general economic outlook is showing some signs of improvement, conditions in the food retail sector are likely to remain challenging for the foreseeable future as customers continue to spend cautiously. We remain committed to investing for the future and continue to see significant opportunities for growth. We remain confident that our differentiated offer, supported by the ‘value of values’, Nectar data and Brand Match, will allow us to outperform our peers in the year ahead.

“After 10 wonderful years at Sainsbury’s, I will leave the business at our AGM in July and will hand over to Mike Coupe, our group commercial director. I am delighted that Mike will lead Sainsbury’s on the next phase of its journey. Mike played an instrumental role in our ‘Making Sainsbury’s Great Again’ plan and is ideally equipped to lead Sainsbury’s as the company continues to develop and grow in tune with the changing consumer and industry environment.”