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Healthy Food Helps Sainsbury Report Xmas Cheer

J. Sainsbury, Britain's third largest grocer by market share, reported upbeat Christmas trading on Thursday after its advertising campaign for healthy eating paid off with shoppers.

Sainsbury said like-for-like sales rose 5% excluding fuel, in line with expectations for the 12 weeks to Dec. 30 thanks to strong demand for premium and organic foods.

"The results achieved give us good momentum to deliver sales growth as we enter the fourth quarter," Sainsbury said in a statement.

Analysts had expected the grocer to deliver underlying sales up as much as 5% against tough comparables.

Sainsbury's market share grew to 16.4% in the 12 weeks to Dec. 31, putting it within 0.2% of Wal-Mart's British grocer Asda, data from TNS WorldPanel showed on Wednesday.