Family-run Morrisons Supermarkets, Britain's fifth largest food retailer, has reported a pre-tax profit of £114.5m (US$177.9m) for the 27 weeks ending 11 August, a 16% increase from last year.

The company, whose stores are located mostly in the north of the country, has increased its market share to around 5.9% through a combination of low prices, tight cost control and steady expansion.

Chairman Ken Morrison expects the company to achieve its £267m (US$414.5m) end-of-year profit forecasts. The company's shares have risen 3.6% this year, surpassing UK rivals by 18%.

Despite the current lull in consumer spending and the competitive market, Morrisons is performing better than sector rivals. It has a different strategy to its competitors - Morrsions has no loyalty cards, overseas subsidiaries or debt.

After recent speculation that Wal-Mart subsidiary Asda was looking at a possible takeover bid for Safeway, Morrison agreed that his company might be better suited for a join with Safeway because their territories are mainly at opposite ends of the country, but the chairman admitted the store sizes were too different. In anycase, he added that Morrisons is contented to expand at a more conservative rate. The company, which currently has 113 stores and 92 petrol stations, plans to open only ten more stores next year in order not to take on any debt, reported Reuters.