'Challenging conditions' to weigh on grocery markets for two years, says Sainsbury's CEO

It could take up to two years before "extremely challenging" conditions in the grocery market improved, Mike Coupe, the chief executive of Sainsbury's, said on Sunday.

"First, as of today, there's no sign the grocery market is going to return to volume growth and that would be a tipping point," he was quoted as saying by the Sunday Times.

"Second, there's no sign that there will be food inflation coming through in the next period, so the market dynamics are going to be extremely squeezed."

Coupe added that Sainsbury's was well placed for a market recovery.

"We have outperformed by about 1% a year for the past five years and I would expect that to be the case in the future," he told the broadsheet.

The Sainsbury's chief executive also said he would not raise cash by selling and leasing back more of the firm's stores, as suggested by activist investors such as Crystal Amber.

"Sale and leasebacks are just another form of debt, and very expensive debt. We're 60 percent freehold, and we believe it would be the wrong way to fund the business," he said.