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| Sainsbury profits jump to £380m | Sainsbury profits jump to £380m |
| (40 minutes later) | |
| Supermarket chain Sainsbury has seen its full-year profits surge as it cut prices to lure customers from rivals. | Supermarket chain Sainsbury has seen its full-year profits surge as it cut prices to lure customers from rivals. |
| Underlying pre-tax profit was £380m in the 52 weeks to 24 March, from £267m in the same period a year earlier. Sales climbed 6.9% to £18.52bn from £17.32bn. | Underlying pre-tax profit was £380m in the 52 weeks to 24 March, from £267m in the same period a year earlier. Sales climbed 6.9% to £18.52bn from £17.32bn. |
| That strong growth means that staff will share a record £56m bonus pot. | That strong growth means that staff will share a record £56m bonus pot. |
| Sainsbury, which has been a takeover target for a private equity consortium in recent months, also said it had narrowed its pensions deficit to £55m. | Sainsbury, which has been a takeover target for a private equity consortium in recent months, also said it had narrowed its pensions deficit to £55m. |
| "This strong performance was delivered despite potential takeover speculation in the last quarter of the year," said chairman Philip Hampton. | "This strong performance was delivered despite potential takeover speculation in the last quarter of the year," said chairman Philip Hampton. |
| "The board did not receive a formal bid approach capable of being put to shareholders," he added. | "The board did not receive a formal bid approach capable of being put to shareholders," he added. |
| Despite the better-than-expected earnings growth, Sainsbury's shares dipped by 4.5 pence, or 0.8%, to 553.5p during early trading in London. | |
| 'Retain ownership' | 'Retain ownership' |
| Sainsbury is facing calls from some investors who want to split up its supermarket and real estate business. | Sainsbury is facing calls from some investors who want to split up its supermarket and real estate business. |
| They believe that as much as £4bn should be returned to shareholders by the sale of real estate. | They believe that as much as £4bn should be returned to shareholders by the sale of real estate. |
| Sainsbury said that the value of its property holdings was £8.6bn, 65% more than earlier estimates, and underlined its unwillingness to cave in to pressure to break up its business. | |
| Now is the right time to look to the next stage of our recovery and to expand the business to drive growth for the longer term Justin King, CEO Check Sainsbury's shares | |
| "Property has always been at the heart of our business and is closely aligned to our successful operation," Mr Hampton said. | "Property has always been at the heart of our business and is closely aligned to our successful operation," Mr Hampton said. |
| Our estate still has considerable development potential, which we believe will maximise both operational and freehold property value," he added. | |
| "As we move from recovery to growth, we believe it is right to retain ownership of our properties." | "As we move from recovery to growth, we believe it is right to retain ownership of our properties." |
| Looking out | |
| Sainsbury said that it had cut prices on 20,000 products, and had benefited from greater demand for organic and its premium Taste The Difference range. | |
| As a result, the company said it was ahead of its current sales targets and set new forecasts for the coming three years. | |
| Sainsbury launched a restructuring programme in 2004, which is due to come to an end in October this year. | |
| "We believe now is the right time to look to the next stage of our recovery and to expand the business to drive growth for the longer term," said chief executive Justin King. | |
| Mr King has now overseen nine quarters of consecutive sales growth. | |
| Sainsbury said that it planned to increase sales to £3.5bn by the end of 2010 and would look to increase its amount of retail space by 10% and roll out its online home delivery service to 200 stores nationwide. |