A Coles supermarket. Picture: Getty Images.
A Coles supermarket. Picture: Getty Images.

UPDATE 2.20pm: Wesfarmers shares defied the broader market trend to post gains today after Coles lifted quarterly sales by an impressive 6.4 per cent despite the grocery chain having slashed prices for shoppers.

The supermarket giant's third quarter sales lifted to $8.35 billion from $7.85 billion.

Comparable Coles food and liquor sales, which strips out store closures and openings, were up 5.3 per cent.

Coles posted its 16th consecutive quarter of growth in comparable sales.

Coles managing director Ian McLeod said the growth was driven by an increase in the number of items sold as shoppers took advantage of a 1.3 per cent drop in prices.

Coles prices have been falling for years due to its price war with rival Woolworths and are down 1.7 per cent so far this year.

"Our customers have benefited from our focus on quality fresh food and a better shopping experience, as well as our unwavering commitment to lowering prices despite external cost pressures," Mr McLeod said.

Wesfarmers' home improvement business Bunnings lifted sales by 6.7 per cent to $1.858 billion.

"This is a reflection of the continuing focus on providing better service, improving our offer, investing in the store network, and lowering our cost of doing business," managing director of home improvement and office supplies John Gillam said.

Officeworks sales increased by a more modest 0.5 per cent to $417 million amid challenging conditions for its small-to-medium-sized business customers.

Department store Target lifted sales one per cent to $699 million thanks to stronger January sales for clothing and toys and the earlier timing of Easter.

And discount department store Kmart saw quarterly sales rise 3.6 per cent to $842 million on the back of improvements in its everyday ranges and stock availability.

"Low prices have continued to drive volume, with in-store execution and greater product availability also contributing to sales growth in the quarter," Kmart managing director Guy Russo said.

Wesfarmers shares closed up 33 cents at $42.22 in a sharply weaker market.

The West Australian

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