Tesco reports second successive quarter of growth

Tesco has revealed a rise of 0.3% in UK like-for-like sales during the first quarter of 2016-17.

Group like-for-like sales rose by 0.9% while international like-for-like sales rose by 3.0%.

Dave Lewis, Tesco CEO, said:

“We have delivered a second quarter of positive like-for-like sales growth across all parts of the Group in what remains a challenging market with sustained deflation. In both the UK and Internationally, we are putting customers at the centre of everything we do and re-configuring our business to serve them a little better every day. Our new fresh food brands are performing very well, with over two-thirds of our customers having bought products from the new range.

“We are encouraged by the progress we are making. By growing volumes, transforming the way we work together with our suppliers, and further optimising our store operating model we are rebuilding profitability in a sustainable way. I am confident that the improvements we are making for customers are working and will create long-term value for our shareholders.”

Tesco also confirmed plans to sell its Harris & Hoole coffee shop chain to Caffe Nero.

The grocer is keen to focus on its core business, and has recently sold the Dobbies Garden Centres chain; restaurant chain Giraffe, and Turkish supermarket chain Kipa.

Click here to view the full release.

Analyst View:

Hannah Maundrell, editor in chief at www.money.co.uk gave us her views on on how this will affect the markets going forward. 

“It’s clear the new Tesco boss means business and he has been bold in his decisions. Tesco seem to have finally identified what keeps its customers happy and we’ve waved goodbye to 24 hour opening in many stores and fringe businesses like Dobbies and Giraffe as a result. The series of brave moves are paying off and the focus is rightly on lowering prices and introducing more choice. “

It’s disappointing Tesco has yet to sign the NFU fruit and veg pledge – they ought to lead by example and be the first of the biggest chains to do so. Tesco’s image has suffered over the past few years and this could take them one step closer to getting shoppers to view the brand more ethically. If Aldi and Lidl can give farmers a fair deal and keep prices low for customers, surely Tesco can too.”

Source : Insight DIY

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