Tesco's profits grow despite fall in UK like-for-like sales
Tesco has reported a 12% increase in its first half profits despite a fall in underlying sales in the UK.
In the 26 weeks to 27 August group sales rose by 8.8% to £35.5 billion, but like-for-like UK sales excluding VAT and petrol fell 0.5%.
Tesco said the tough trading in the UK had been offset by expansion in its Asian markets and by a 23.2% reduction in losses at its US Fresh and Easy chain.
The retailer said it had suffered more that its competitors due to the higher proportion of discretionary items sold in its stores. In addition higher fuel prices had impacted on customers' spending power as they spent an extra £750 million pounds on filling up their cars compared with the same period last year.
CEO Philip Clarke said: "I am pleased that excellent growth in Europe and Asia, as well as an encouraging performance in the United States, have supported further progress in the first half, despite the challenges of subdued demand in the UK, particularly in non-food categories."
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