Britain's fourth-biggest supermarket group is also expected to confirm plans to return £500m to shareholders both this financial year and the next, in spite of having only bought about 10 per cent of this year's share buyback so far.

Analysts say the buyback could help underpin Bradford-based Morrisons' shares as it faces more demanding sales comparatives in the second half of the year.

Just two years after Marc Bolland joined the group in September 2006 as chief executive from Heineken in the Netherlands Morrisons is set to report profit before tax and one-off items of £294m for the 26 weeks to August 3, according to an average forecast of eight analysts. That would be a 19 per cent increase on the same period last year.

Like-for-like sales, excluding fuel, are forecast to climb 7.2 per cent in the second quarter, boosted by higher food prices as grocers pass on the rising cost of commodities such as meat and dairy products.

Industry data from TNS and Nielsen show Morrisons continues to outperform the overall grocery market, although perhaps not by as much as earlier in the year.

The group is, after several integration problems, feeling the benefit of its purchase of rival Safeway in 2004 as well as its "refresh" campaign to revamp stores and its image as a lower-priced alternative to some of its rivals.

Cash-strapped shoppers are trading down to cheaper stores amid higher fuel and food costs, as well as sliding house prices.

Analysts are looking for signs of whether Morrisons will step up promotional spending as it comes up against the second half's tougher sales comparatives. They are also keen for an update on whether Morrisons will try to buy stores from the Cooperative Group, which is expected to put some on the market following its purchase of Somerfield.

Sam Hart, an analyst at Charles Stanley Equity Research, said: "Morrisons is expected to report a strong set of interim results, as benefits of the restructuring programme continue to come through. First quarter like-for-like sales were up by an impressive 7 per cent, and the good performance is expected to have continued.

"Growth has been driven by initiatives in range, store format, branding and marketing. Food price inflation of around 3 per cent has provided a further boost. Low exposure to the more discretionary non-food segment and the group's value bias leaves it well placed relative to peers to weather the consumer downturn.

"A full progress report on the restructuring programme is expected. Progress should have been made in strengthening the distribution network in southern England and upgrading IT systems."

Morrisons runs 375 stores and has a market share of about 11 per cent, trailing J Sainsbury.