Tesco sales fall 2.4pc as faltering Irish economy bites
Retailer is upbeat as results 'better than last two quarters'
Published 09/12/2011 | 05:00
Retail giant Tesco has continued to feel the pinch in Ireland, with sales in its stores here declining 2.4pc in the last quarter.
The fall comes on top of a 3pc fall in the previous quarter, but Tesco described the latest performance as "encouraging". It said although sales at stores open at least a year here had slipped 2.4pc, the fall was "ahead of the market and slightly better than during the last two quarters".
The fall was the biggest among its European operations, all of which recorded like-for-like third-quarter sales growth except the Czech Republic.
Tesco's Irish operations are typically among the group's most profitable. The chain operates more than 120 outlets here and is engaged in a €120m investment programme in Ireland. Tesco's sales in the financial year to the end of February 2011 totalled just under €3bn in Ireland. On a like-for-like basis, sales were 2.2pc higher.
Shares in Tesco edged up slightly yesterday despite its performance in the UK during the third quarter being weaker than expected by analysts.
Like-for-like sales in the UK fell 0.9pc in the third quarter, marking the fourth straight quarterly decline.
Chief executive Philip Clarke said that the retailer had seen stronger food sales on the back of a 'Big Price Drop' campaign.
"While I'm pleased with these early signs of a stronger performance, a great deal more remains to be done," he added.
Mr Clarke said that Tesco's Fresh & Easy chain in the United States had delivered a "pleasing" performance, with robust sales growth.
He said sales in Thailand, where Tesco has 165 stores, had been hit by recent floods there. About 100 of those outlets won't reopen until January.