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Sainsbury delivers strong results
LONDON, England (CNN) -- Sainsbury, the UK's second largest supermarket chain, has announced a rise in profit of almost 11 percent over the last six months, after streamlining its operations. Profit before deductions was £342 million ($543.5 million) in the six months to October, from £309 million a year earlier, according to figures on Wednesday. Analysts had expected a profit of between £340 million and £342 million. Sainbury raised its interim dividend by 5 percent to 4.22 pence a share. Operating margins at its UK supermarkets were 3.8 percent higher as the group continued to reduce overheads. In the past two years, Sainsbury has modernised many of its distribution centres and closed others, while renovating its stores and offering more home products. Chief Executive Peter Davis said those changes had helped the company -- which has 476 supermarkets in the UK -- to maintain its No. 2 position behind Tesco and to stay ahead of U.S.-based Wal-Mart. "The competition in this country is as severe as anywhere in the world," Davis told CNN. "I think British retailers offer good value for money." First-half net income increased to £206 million, or 10.7 pence a share, from £175 million, or 9.1 pence a share, a year earlier. Sainsbury (SBRY) shares -- which hit a two-year low of 243 pence in October -- were up 1.9 percent to 299.50 pence in early London trading on Wednesday.
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