UK grocer Sainsbury's profit growth slows

London - British grocer J Sainsbury posted a 5.3% rise in annual profit, its slowest growth in nearly a decade, illustrating the pressure the industry is under as a battle over prices to combat the rise of the discounters hots up.

Sainsbury's, which trails market leader Tesco and is battling with Walmart's Asda to be Britain's No. 2 grocer, said on Wednesday it made an underlying pretax profit of £798 ($1.36bn) in the year to March 15.

That compares with analyst forecasts in a range of £750-810m, with a consensus of £782, and £756m made in the 2012-13 year.

The firm said conditions in the food retail sector are likely to remain challenging for the foreseeable future as customers continue to spend cautiously.

But it added that it expected its differentiated offer would allow it to outperform peers in the year ahead.