Tesco’s Irish outlets perform well
Sales grew by 7% in Europe, with an “impressive” recovery in Ireland offset by weakness in central Europe, Hungary and Poland.
In a first quarter interim management statement, Tesco, which is Britain’s largest supermarket chain, said domestic revenue barely grew in the first quarter as inflation eased and shoppers balked at the prospect of higher taxes.
Sales at British stores open at least a year rose 0.1%, excluding petrol and value-added tax, in the 13 weeks ended May 30.
“Life has got tougher in UK food retailing,” Philip Dorgan, an analyst at Ambrian Partners said. He still forecasts an improvement in sales later in the year.
The higher priced Finest range and non-food products performed particularly well with the retailer seeing this as evidence of a “steady consumer recovery”.
Sales of high-end televisions have more than doubled, fuelled by the World Cup.
“The UK performance is slightly off the group’s growth rates, but it’sstill solid,” finance director Laurie McIlwee said.
Tesco isn’t changing its full-year forecast for 3% growth in British same-store sales, he added.
International same-store sales were little changed in the quarter, with some declines in Asia offset by gains in Europe.
Tesco announced last week that Phil Clarke will replace Terry Leahy as chief executive in March.
Total sales rose 8.2% in the first quarter, or 6.9% excluding petrol.
Tesco employs about 13,000 people at its Irish stores.
