Sainsbury’s, the third largest supermarket chain in the UK, reported a massive £72m loss in the year leading up to 14th March.
Some of the main reasons were one-off costs, including a fall in value of some of its current stores.
Even without the one-off costs however, its pre-tax profits fell 14.7% to £681m (it reported £798m the previous year).
Like-for-like sales fell 1.9%, while group sales fell 0.9% as the supermarket chain faced fierce competition from budget stores such as Aldi and Lidl.
These results are the first published since chief executive Mike Coupe took over from Justin King last year.
Mr Coupe said in the result statement: “The UK marketplace is changing faster than at any time in the past 30 years which has impacted our profits, like-for-like sales and market share.
“However, we are making good progress with our strategy, and our investment in price and quality is showing encouraging early signs of volume and transaction growth.”
Both cheaper goods and the fall in fuel prices has had an impact on all supermarkets. On the Today programme, Mr Coupe said: “With customers having more money in their pocket, they tend to eat out rather than eating in so that has a drag on the supermarket industry.”
Last month, Tesco reported a £6.4bn loss. The majority of the loss was because of the decline in value of its property portfolio.
The supermarket industry is suffering due to the intense competition from cheaper stores. This triggered a price war in the already established supermarket chains.