Business Irish

Tuesday 20 March 2018

Revenue down but worst over for Ireland, says Tesco chief


Peter Flanagan

IRELAND is past the worst of the economic crisis, the head of Tesco's Irish operation said yesterday, as the retailer reported a dip in revenue here but a surge in online business.

In a statement yesterday, Tesco Ireland chief executive Tony Keohane said that while his company did not see "any immediate uplift in domestic economic trends", it believed "the worst may well be behind Ireland".

Mr Keohane's comments came after the retailer said it recorded revenue of some €1.5bn during the six months to September 24.

Transactions increased by 5.2pc but like-for-like sales declined 3.4pc, reflecting what the company called "food price deflation and lower consumer spending, particularly on non-food products".

"Food prices in Ireland have remained low despite continued commodity price inflation worldwide," the company added.

Online shopping increased by a fifth during the half year, although that is believed to be from a low base, while sales of own-brand ranges continued to strengthen.

The group's mobile phone business, Tesco Mobile, now has more than 120,000 customers.

"Irish consumers are adapting to changed economic circumstances, but are still feeling the strain of reduced incomes and uncertainty about the future," said Mr Keohane.

Mr Keohane added that the firm was investing some €120m in Ireland this year.

News of the company's performance here came as overall first-half profit climbed 3.7pc on gains in Asia and a narrower loss in the US, offsetting the company's worst UK sales performance in at least six years.

Trading profit, a measure that excludes property gains, rose to £1.77bn (€2.04bn).

Tesco is focusing on improving returns on capital in its 13 international markets and said a plan to break even in the US in fiscal 2013 was showing "promising early results".

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