Iceland’s market share could drop below 2% by the end of the year if current trends continue, according to data from TNS Superpanel.

The chain’s share of the UK food retail market has dropped from highs of 2.9% in December 2000 to 2.3% in September 2002. Broker Schroder Salomon Smith Barney said: “Market share has been lost every month for the past 18 months.”

Parent company, the Big Food Group, releases its second quarter trading update this Wednesday, and according to market research conducted by TNS for the four weeks to September 15, shows that Iceland's till roll sales fell 9.2%.

First quarter like-for-like sales at its frozen food stores fell 8% in July and lead to the group warning of a £16m shortfall in Iceland's projected full-year profits.