Sainsbury’s expects supermarket price war and rising costs to hit profits

The Sainsbury’s chain increased sales by 4.2% to £26.6bn. Photograph: Reuters/Alamy

Sainsbury’s has warned that profits are not likely to rise this year as it braces for an expected price war among the UK’s supermarkets and faces rising costs from higher wages.

The group joined Tesco, Next and Marks & Spencer as one of a handful of retailers who have made £1bn in profits in the year to 1 March, but it does not expect to beat that figure this year despite plans to cut costs with more automation and warehouse closures.