J Sainsbury has raised the lower end of its full-year profit guidance after delivering underlying operating profit growth of 3.6% in the first half.
The supermarket giant reported continued volume gains in grocery offsetting a decline in general merchandise and the accounting impact of the Argos disposal.
Underlying operating profit from continuing operations rose to £525 million in the 28 weeks to 12 September 2026, from £507 million a year earlier, as grocery sales grew 2.9% to £13.2 billion.
This was helped by volume growth and Sainsbury's price-matching initiatives, including its Aldi Price Match and Nectar Prices schemes.
The group now expects full-year underlying operating profit from continuing operations of between £1.025 billion and £1.065 billion, lifting the lower end of its previous range.
Underlying profit before tax rose 5.2% to £366 million, while underlying basic earnings per share increased to 11.7 pence from 10.6 pence, supported by a 3.1% reduction in the weighted average share count following buybacks.
Groceries Online sales grew 9%, and the OnDemand rapid delivery service has been extended to nearly 95% of stores.
Fuel sales surged 17.8% to £2.3 billion, reflecting higher wholesale prices driven by Middle East conflict, though this contributed to a statutory loss after tax of £164 million as the Argos disposal triggered a £317 million non-cash impairment charge.
Argos, which has been classified as a discontinued operation following the agreed sale to Swift Partners, saw revenue fall 1.8% and generated an operating loss of £8 million in the period.
The group completed £200 million of a £300 million share buyback programme during the half and declared an unchanged interim dividend of 4.1 pence per share.
Free cash flow increased by £57 million to £333 million, and Sainsbury's said it remains on track to deliver more than £500 million for the full year.
Chief executive Simon Roberts said the business was focused on helping customers manage stretched household budgets, with further food innovation planned ahead of the Christmas trading period.
