In a refreshing change at a time characterised by crashing profits, supermarket chain Sainsbury, has reported a staggering 28% increase in profits, for the year ending in March 2008. Annual pre-tax profits were £488 million. An increase in like-for-like sales were also reported, which were up by 3.9% in all sectors except fuel.

Sainsbury had been on a recovery program since 2004 and the figures achieved this year were higher than their set target of 2.5 billion pounds sales growth by March 2008. This goal was bettered to 2.7 billion pounds sales growth. This improvement has been greatly aided by lower prices and consistently strong sales in the fresh and premium food divisions.

Sainsbury is currently ranked third in the supermarket hierarchy in the country, right after TESCO and Wal-mart’s Asda. Their expansion plans include a foray into the non food online business, with an investment of £15 million pounds. They also plan to expand their banking operations.

Sainsbury expects nearly two-thirds of their future sales to be in the food division and one –third from the non-food ones. They intend to give half their space to the burgeoning non-food section. The tight economy however will ensure that the markets will remain intensely competitive.

The board has recommended a final dividend of 9 per share, adding the year’s dividend up to 12 pence, which would mark an increase of 23%.