Supermarket chain J Sainsbury has unveiled a 2.9% fall in profits and said it is cutting prices in an attempt to win back market share.

Underlying profits for the year fell to £675m ($1.2bn) from £695m in 2003 as sales remained disappointing.

The company's new chief Justin King said the chain had "not stayed as sharp on pricing as we should have done".

Sainsbury's lost its position as market leader to Tesco in 1995, and was pushed into third spot by Asda last year.