Sainsbury’s has upgraded its full-year profit outlook after posting another period of volume growth ahead of the market, marking a fifth straight year of outperformance.

For the 28 weeks to 13 September, the supermarket chain’s retail underlying operating profit came in at £504m, slightly ahead of expectations and broadly flat year-on-year.

Sales excluding fuel also rose 5.2%, with core grocery up 5.3%. Argos returned to growth, up 2.3%, while Tu rose 7.8% in what Sainsbury’s described as a tough environment for general merchandise and clothing.

CEO Simon Roberts said the business had “planned for a strong summer and delivered”, with customers responding to lower-than-market inflation and the combination of Aldi Price Match, Nectar Prices, and the premium Taste the Difference range.

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“We’re investing where it matters most with Aldi Price Match on everyday essentials and bringing personalised Your Nectar Prices to all supermarket customers. Customers saved an average of £14 on an £80+ big weekly shop with Nectar Prices,” Roberts said.

“The retailer said value perception improved while premium own-label also grew, with 65% of customers mixing Aldi-matched lines with Taste the Difference in the same basket.

Roberts said availability and service had improved across the estate, alongside upgrades to online and the Argos app.

The supermarket now expects retail underlying operating profit of more than £1bn this year and retail free cash flow above £500m.

Roberts added that Sainsbury’s was “well set” for Christmas, with in-home trading expected to remain strong as shoppers look for value while still opting for premium lines.