Tesco Ireland bucks downward European sales trend
THE Irish arm of the retail giant Tesco is undergoing a strong recovery, according to a trading statement released by the company yesterday.
The first quarter interim management statement pointed to "Ireland's impressive sales recovery" as contributing to group sales in Europe growing 7.3pc over the period.
The company, which has 119 stores in Ireland, said the recovery in Irish sales helped offset sales declines caused by "a late spring in central Europe, the period of mourning in Poland [following the death of the president] and ongoing economic difficulties in Hungary".
International growth was driven by Asia, where new store openings brought about 15.4pc growth, although like-for-like sales were slightly negative, hit by political uncertainty in Thailand and Korea.
Overall, Tesco reported an 8.2pc increase in sales for the 13 weeks to May 30 while UK like-for-like sales were up only 0.1pc when adjusted for VAT and petrol.
The outlook for the year as a whole remained unchanged.
Liam Igoe, an analyst with Goodbody stockbrokers, saw the figures as "generally positive" for Irish food suppliers.
"The Tesco statement is consistent with Greencore's and Kerry's experience with UK multiples -- though the inflation environment may herald flat pricing, if not a return to food deflation, as product capacity reduction may continue to put some upward pressure on prices," he said.