Tesco's Irish volumes rise as it keeps lid on prices
Tesco's like-for-like sales in Ireland rose by just 0.2pc in the first quarter of the group's financial year, but its volume growth here jumped 3.8pc as it continued efforts to keep a lid on prices in its core food lines.
The retailer, which held its annual general meeting yesterday, said its fresh food sales in Ireland climbed 5.3pc in the first quarter. In the UK, the group reported the strongest quarterly sales growth in seven years, rising 2.3pc in the first quarter.
Tesco chief executive Dave Lewis said that in tough market conditions, the group has kept prices low and seen consumers do more of their shopping with the retailer.
"This is a good start to the year, with our sixth consecutive quarter of positive like-for-like sales growth across the group," he said.
Analysts had anticipated a like-for-like sales rise of between 1.7pc and 2pc. Tesco's shares initially rose more than 4pc in London but quickly yielded the gains amid concerns about a deteriorating consumer environment in Britain and lower international sales.
"The key focus for this quarter has been working with our supplier partners to protect our customers from inflation," said Mr Lewis. The performance was driven by 1.3pc growth in customer transactions, 10m more year-on-year, and by volume growth in fresh food of 1.6pc.
Mr Lewis has been leading a fightback after profits were hammered by changing shopping habits, the rise of Aldi and Lidl and an accounting scandal in 2014.
He stabilised the business and got it growing again with a focus on lower prices, new and streamlined product ranges, better customer service and improved supplier relationships. It is Britain's largest supermarket by a wide margin.
In Ireland, it's the country's second largest grocery retailer, having recently regained that position after being relegated to third place for some time. It's now slightly larger than Dunnes Stores in terms of the value of sales, with a 22pc share of the market, according to Kantar Worldpanel figures. Musgrave-controlled SuperValu is the largest, with 22.5pc.
Tesco sales were €2.5bn in Ireland in the 52 weeks to February 25, excluding VAT but including fuel. (Additional reporting: Reuters)