Tesco makes 'good start' to year
Tesco has grown its first half sales and profit after achieving strong like-for-like growth in the UK and Ireland.
Group revenue increased by 12.8% to £28.3 billion while statutory pre-tax profit rose by 2% to £564 million. However, operating profit before exceptional items was up 24.4% to £933 million, which was lower than analysts’ forecasts of £978 million.
UK and Ireland like-for-like sales increased by 3.8% in the period after a 3.5% rise in the first quarter and a 4.2% uplift in the second. In a statement, Tesco said it is now more than half-way through the re-launch of 10,000 own brand products, which has initially focused on fresh food and will complete by February 2019.
In Central Europe, changes to Sunday trading regulations in Poland resulted in thirteen fewer trading days in the first half which affected like-for-like sales.
Meanwhile the supermarket’s like-for-like sales in Asia improved from decline of 9% in the first quarter to a fall of 4.8% in the second quarter following the annualisation of its decision to remove bulk-selling. Tesco is currently focusing its efforts on turning the business around.
Commenting on the performance, Dave Lewis, Tesco chief executive, said: “We have made a good start to the year. The step up in Q2 is driven mainly by the UK & ROI and delivers our eleventh consecutive quarter of growth.
“At the same time, we have made further strategic progress. We completed our merger with Booker in March and are delighted with performance so far. We announced a strategic alliance with Carrefour in July which goes live this month.
“And we are now more than half-way through the biggest own brand re-launch in our nearly 100-year history, including a significant investment in over 300 new 'Exclusively at Tesco' products at market-leading prices.”
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