Sainsbury's sales dip for fifth straight quarter

LONDON, March 17 (Reuters) - British supermarket Sainsbury's posted a fifth straight quarter of declining underlying sales and said it did not expect the trading environment to improve any time soon.

The group, which trails market leader Tesco (Xetra: 852647 - news) and Wal-Mart's Asda by annual sales, said on Tuesday sales at stores open over a year fell 1.9 percent, excluding fuel, in the 10 weeks to March 14, its fiscal fourth quarter.

That compares with company guidance of down about 2 percent and a third quarter fall of 1.7 percent.

Sainsbury's said it expected the market to remain challenging for the foreseeable future.

"Food deflation is likely to persist for the rest of this calendar year, and competitive pressures on price will continue," it said, adding that it expected to outperform its supermarket peers.

(Reporting by James Davey; editing by Kate Holton)