The third biggest supermarket chain in the UK, Sainsbury, increased its market share by 16.6 percent across the year (Reuters)

J Sainsbury plc, the third biggest supermarket chain in Britain, said its profits rose 7.1 percent across the year, as it increased its market share in the country's highly competitive grocery market and continued its good run of results.

Solid growth in its own brand food products, general merchandise and clothing, its convenience stores, and Sainsbury's Bank all fed in to a strong first quarter that outperformed a volatile market.

"Whilst the wider economic situation remains uncertain, we remain confident that our clear strategy, market insight and strong values will enable us to make further progress both in our core food and non-food businesses, as well as new channels and services in the year ahead," Justin King, Sainsbury's chief executive, said in a statement.

Profit-before-tax for Sainsbury hit £712m in 2011/2012, up 7.1 percent on the previous year's profits of £665m.

Total sales were up 6.8 percent on the year, hitting £24.5bn.

Underlying basic earnings per share was up by 6 percent, to 28.1 pence a share, while Sainsbury proposed full year dividend of 16.1 pence is up by 6.6 percent.

Across the year Sainsbury managed to increase its market share by 16.6 percent.

Taste the Difference, its own-label top range brand, saw sales up 8.2 percent, while basics, its no-frills line, saw sales growth of 6.8 percent.

Sainsbury has also become the fastest-growing online food retailer with 20 percent sales growth for the year and its web business is now worth £800m.

Throughout the year Sainsbury opened 1.4 m sq ft of new space, adding 19 new supermarkets, 73 convenience stores, and extending 28 existing stores.

Its property is now valued at £11.2bn.

Sainsbury's Bank, a joint venture between the supermarket and Bank of Scotland which offers consumer banking services, saw a 40 percent pre-tax profit rise in the year.

During the festive period Sainsbury hailed its "best Christmas ever" for trading.

London-listed J Sainsbury plc shares were up 3.09 percent on the day to £310.60 at 8:47am BST.