Only UK's Sainsbury's and Waitrose holding off discounters - Kantar

LONDON, Oct (KOSDAQ: 039200.KQ - news) 22 (Reuters) - J Sainsbury and John

Lewis's Waitrose are the only Top Six British grocery

chains currently resisting pressure from discounters Aldi

and Lidl to expand their market share,

monthly industry data showed on Tuesday.

Though data and surveys have indicated the outlook is

improving for UK consumer spending, retailers are generally

still wary as inflation continues to outpace wage rises.

In recent weeks, store groups including market leader Tesco (LSE: TSCO.L - news)

and No. 3 Sainsbury (LSE: SBRY.L - news) 's, have highlighted the

fact that consumers' disposable income is still

falling.

Sainsbury's and Waitrose, the UK's No. 5 grocer,

outperformed the market with year-on-year sales growth of 3.7

percent and 7.6 percent respectively in the 12 weeks to Oct. 13,

narrowly expanding their market share, researcher Kantar

Worldpanel said.

However, their growth was dwarfed by a 31.7 percent sales

rise at Aldi, which gave it a record market share of 3.8 percent

against 3.0 percent a year earlier.

Aldi more than doubled its profit in its UK business in

2012, as it attracted 1 million more shoppers and got existing

customers to spend more.

"The retailer has done a particularly good job in conveying

its competitive pricing message through its 'Like Brands Only

Cheaper' and subsequent 'Swap and Save (Milan: SAVE.MI - news) ' campaigns - both of

which have given the supermarket a clear point of difference,"

said Kantar director Edward Garner.

Lidl also kept up its strong run with sales growth of 13.1

percent and a market share of 3.0 percent, up from 2.7 percent.

The trend for higher- and lower-end chains to gain at the

expense of the middle ground was clear as the No. 1, 2 and 4

grocery chains by sales - Tesco (Other OTC: TSCDF - news) , Wal-Mart's Asda and

Morrisons - all recording sales growth of 1.0 percent or less,

against a 3.0 percent market average.

Last month, Tesco reported flat underlying sales for its

second quarter, while Sainsbury's posted a second quarter rise

of 2.0 percent, albeit for a different period.

Kantar said grocery inflation remained at 4.2 percent for

the 12 week period.

Market share (percent)

12 weeks to 12 weeks to pct change

Oct 13, 2013 Oct 14, 2012 in sales

Tesco 30.1 30.8 0.4

Asda 17.2 17.6 1.0

Sainsbury 16.7 16.6 3.7

Morrison 11.2 11.4 1.0

Co-operative 6.4 6.7 -1.2

Waitrose 4.9 4.7 7.6

Aldi 3.8 3.0 31.7

Lidl 3.0 2.7 13.1

Iceland 2.0 2.0 2.3