Woolworths edged closer to an eventual break-up as the variety retailer and entertainment wholesaler dragged its stores back to profit and announced a tie-up with Somerfield, the supermarket chain.

Trevor Bish-Jones, chief executive, said there would be no imminent demerger of the group, which comprises a publishing joint venture with the BBC alongside the Woolworths chain and its EUK business, which supplies supermarkets with books and CDs.