Woolworths Ltd’s Australian grocery arm grew its market share during the retailer’s third quarter as the company saw sales rise.

Australia’s largest retailer said today (18 April) that sales in its Australian Food and Liquor division reached A$9.2bn (US$9.7bn) during the quarter ended 3 April, a 4.6% increase on the year.

When adjusted for Easter, which took place during the third quarter of Woolworths’ last fiscal year, sales were up 5.2%.

Comparable-store sales were up 3.3% during the quarter, or 3.9% when adjusted for Easter.

Woolworths said prices fell 3.6% on average, excluding tobacco, when the effects of promotions are included. The retailer added that part of the deflation has been due to it “lowering its prices for the benefit of customers in a dynamic market”.

However, it said that significant inflation was experienced in produce following the recent natural disasters and subsequent availability issues.

In general, the retailer said trading “continues to be impacted by tightened consumer spending with higher savings rates, and higher interest rates, petrol and utility prices”.

Woolworths’s supermarkets in New Zealand recorded a 3% sales increase during the third quarter to reach NZ$1.4bn (US$1.11bn), or up 2.9% when adjusted for Easter. The retailer said comparable sales were up 3% during the quarter.

Woolworths said the New Zealand economy remains challenging “particularly following the most recent Christchurch earthquake”, with four damaged stores remaining closed and undergoing repairs. The retailer said that, while customers have continued to shop at its other nearby stores, “sales for the quarter have been adversely impacted”.

Nevertheless, the retailer said its performance in the country has “exceeded overall market growth”, which it attributed to the “success of the improved customer offer in New Zealand” through its conversion of stores to the Countdown banner, as well as improved range and private-label offers.

Shares in the retailer were up 0.72% to A$26.7 a share at the market’s close today.