Friday 23 February 2018

Tesco sales still in negative territory despite slight improvement here

Supermarket giant Tesco
Supermarket giant Tesco
John Mulligan

John Mulligan

TESCO said its sales in Ireland improved in the latest quarter compared with the previous three months, but are still on a negative trend.

Shares in the British retailing goliath came under pressure as it said it encountered challenging trading conditions over the Christmas and new year period, with its UK like-for-like sales falling 2.4pc amid market weaknesses.

Smaller rival Morrisons, headed by Wicklow native Dalton Philips, said yesterday it had a "very challenging" Christmas, with shoppers cutting their spend and deflecting to rivals.

Morrisons, which ran a Christmas ad campaign featuring entertainment duo Ant and Dec, said like-for-like sales excluding fuel fell 5.6pc in the six weeks to January 5. Its shares tumbled close to 10pc.

At Tesco, the retailer said it had been hit in the UK by a weaker grocery market, and said the latest trading period suffered from a tough comparative in 2012.

"Our decision to significantly reduce our new store opening programme and our on-going work to transform our general merchandise offer are also holding back top-line performance in the short term," it said.

Chief executive Philip Clarke, who is on a mission to improve Tesco's offer by hiring more staff and transforming stores, insisted the chain had the "most compelling offer" over Christmas.

"Our overseas performance has improved since the third quarter, driven by an improving trend in Europe," he added.

The grocery retailer, the biggest in Ireland, previously said that like-for-like sales here in the quarter to the end Nove-mber 23 plummeted 8.1pc.

The decline followed a 4.4pc fall in Tesco's like-for-like sales in Ireland during the second quarter and a 3pc fall in the first quarter. More than €400m was wiped from its sales here last year compared with 2012.

Tesco and other big rivals are battling Aldi and Lidl for customers, with the German retailers increasingly winning over consumers.

Lidl said this week that it had its best ever Christmas trading in the UK and reported a "huge" increase in sales of its Deluxe range, with upmarket Waitrose also enjoying a good Christmas.

Irish Independent

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