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* UK grocery market grew 3.2 pct in 12 weeks to Dec. 23
* Sainsbury market share up 0.1 pct pt, Tesco down 0.1
* Strongest growth at discount and premium end - Kantar
* UK retail sales up 0.3 pct in December - BRC
* 2013 to be difficult for retailers - BRC
By James Davey
LONDON, Jan 8 (Reuters) - J Sainsbury, Britain's
No. 3 supermarket group, posted the highest sales growth of the
so called "big four" grocers in the run-up to Christmas and was
the only one to grow market share, according to data published
Market researcher Kantar Worldpanel said Britain's grocery
market grew 3.2 percent in the 12 weeks to Dec. 23, with the
strongest growth at the discount and premium ends of the market
- at Aldi and John Lewis' Waitrose respectively.
Among the "big four" - which also includes market leader
Tesco, No. 2 player Wal-Mart's Asda and No. 4
Wm Morrison - Sainsbury's saw sales growth of 3.4
percent, edging up its market share by 0.1 percentage points to
Shares in Sainsbury's, which is due to publish a
third-quarter trading statement on Wednesday, were up 1.5
percent at 337 pence at 1315 GMT.
Kantar provides data on gross sales, while the focus of
retailers' own updates tends to be sales at stores open over a
year, or so-called like-for-like sales.
Tesco, fighting back after a dismal Christmas in 2011 led to
its first profit warning in 20 years, saw sales growth of 2.9
percent but its market share dipped slightly - by 0.1 percentage
points to 30.5 percent, Kantar said.
"This is an improvement on the performance seen throughout
2012, when the average share drop was 0.4 percent, suggesting
that festive shoppers gave the retailer a welcome boost in the
run up to Christmas," said Kantar director Edward Garner.
Shares in Tesco were up 0.1 percent.
Tesco is due to update on Christmas trading on Thursday.
While it is expected to post an improved performance, the
outcome will reflect weak comparative numbers.
Asda saw sales growth of 2.2 percent, but its market share
slipped 0.2 percentage points to 17.3 percent, Kantar said.
Morrisons, which posted a disappointing trading update on
Monday, was the only "big four" grocer to lose sales compared to
last year - they fell 0.6 percent and its market share dipped
0.4 percentage points to 12.0 percent.
Waitrose achieved sales growth of 5.4 percent, while budget
chains Aldi, Lidl and Iceland posted respective growth rates of
30.1 percent, 10.8 percent and 9.7 percent respectively.
Waitrose said last week it had enjoyed a record festive
"Historically, the discounter sector has seen its share dip
at Christmas as shoppers treat themselves and trade up, but the
all-time record share of 3.2 percent for Aldi is a sign of the
times and shows that this is no longer the case," said Garner.
He noted that Aldi and Lidl both benefited from carrying
items such as goose, venison and fine wines in their Christmas
catalogues this year.
Kantar said its measure of grocery price inflation rose
sharply to 4.5 percent for the 12 week period, from 3.5 percent
last reported, suggesting that 2013 could bring a renewed period
of pressure on household budgets.
Separately on Tuesday an industry survey said underlying UK
retail sales rose just 0.3 percent year-on-year in December.
That is well below the rate of inflation, suggesting stores sold
less in real terms, and increases the chances that the economy
contracted in the last three months of 2012.
Many retailers are finding the going tough as consumers,
whose spending generates about two thirds of Britain's gross
domestic product, fret over job security and a squeeze on
With the retail market showing minimal growth, retailers are
battling to steal market share off each other.
"These results are not a cause for celebration, but not a
disaster either," said Helen Dickinson, Director General of the
British Retail Consortium, which runs the monthly survey.
She said with consumers facing up to their credit card bills
after Christmas, January will likely be a particularly tough
month for retailers.
"While consumer confidence remains low, shoppers will
tighten their belts and rein in their spending, making life
difficult for the average UK retailer," said Dickinson. "There
will be no boom and it's likely more than a few will go bust."
With more and more Britons turning to the internet to do
their shopping, the retailers that prospered at Christmas were
those with well-developed online offers, such as John Lewis,
Next and Debenhams.
UK grocers' market share and change in sales (pct) - Kantar
12 wks to 12 wks to pct change
Dec 23 2012 Dec 25 2011 in sales
Tesco 30.5 30.6 2.9
Asda 17.3 17.5 2.2
Sainsbury 17.1 17.0 3.4
Morrison 12.0 12.4 -0.6
Co-operative 6.3 6.5 0.1
Waitrose 4.5 4.4 5.4
Aldi 3.2 2.6 30.1
Lidl 2.8 2.6 10.8
Iceland 2.2 2.1 9.7