Tesco shares fall 4pc after disappointing festive figures
Shares in retail giant Tesco fell by over 4pc yesterday after the group posted sales figures in the run-up to Christmas that fell short of analyst expectations.
A 0.6pc rise in like-for-like sales in the UK for the six weeks to January 8 was less than half the rate forecast by analysts. It also lagged behind the Christmas performance of rivals such as Sainsbury, WM Morrison and Marks & Spencer.
Tesco said that group sales in the period were 7.6pc higher and that total UK sales were up 4.2pc. International sales, which include turnover from its lucrative Irish operations, rose 14.2pc, with sales within Europe climbing 5.6pc.
Tesco added that like-for-like sales growth was positive for the period in every European country in which it operates, while on the wider international front, sales in China and Thailand were "particularly encouraging". But it was UK sales that analysts zeroed in on.
"This below-par performance from Tesco will raise an eyebrow or two," said Clive Black, an analyst at Shore Capital. Mr Black retained his 'buy' rating on the stock, but cut his full-year profit forecast by 1pc.
Tesco finance director Laurie McIlwee said that sales of non-food items had slipped 1.5pc in the six-week period.
Meanwhile, Argos owner Home Retail Group said that sales were in line with expectations during the 18 weeks to January 1.