Budget supermarket Aldi profits from spending slowdown

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Aldi enjoyed year-on-year sales growth of nearly 19 per cent in the 12 weeks to May 18, while Lidl saw takings rise by just under ten per cent.

The price-focused chains Farm Foods and Iceland also posted double-digit rises in sales during the period.

Supermarket shoppers are increasingly turning to 'price-focused' chains

At the same time, heavyweights such as Tesco and Sainsbury's saw dips in their share of the sector's annual £120billion market.

The data showed the clear winner in terms of sales growth during the period was Aldi, whose sales rose 18.9 per cent year-on-year to £577million. Its market share improved to 2.8 per cent from 2.5 per cent.

Edward Garner, director of research for TNS Worldpanel which conducted the survey, said: "This is virtually solely fuelled by new shoppers visiting the stores rather than existing shoppers spending more."

He added that German-owned Aldi had been investing heavily in new stores, with more than 300 in the UK.

"This investment is being rewarded with strong growth," said Mr Garner.

Next best performer in terms of sales growth was Iceland, whose takings grew 12.2 per cent to £352million.

The chain's market share also improved, up 0.1 per cent to 1.7 per cent.

Farm Foods saw sales break through the £100million barrier during the period, rising 10.7 per cent. Lidl's sales were 9.6 per cent ahead at £478million.

Tesco remained far and away the sector leader, with £6.4billion sales, but its market share dipped 0.2 per cent to 31.1 per cent.