Tesco sees Irish first-half sales surge 16% to nearly €1.5bn
Tesco grew first-half sales in Ireland by over 16%.
Sales at Tesco’s Irish operations surged by over 16%, to £1.32bn (€1.48bn) in the first half of the supermarket giant’s financial year, buoyed by online sales and a strong performance from its larger stores.
Tesco Ireland CEO Kari Daniels said it had been a good performance during a period of “prolonged challenges”, with customers confident in the retailer’s safety measures.
“We have shown tremendous agility, teamwork and initiative to fine-tune our operations, working with our suppliers and partners, and investing to support colleague and customer health and safety throughout,” she said.
Ms Daniels said she remains confident of Tesco Ireland performing well despite heightened Covid restrictions being introduced.
“As we enter level-3 restrictions at national level, we are conscious that it will be an autumn and Christmas like never before,” she said.
On a group-wide basis, Tesco reported slightly improved revenues of £28.7bn for the six months to the end of August. Pre-tax profits were up nearly 30% at £551m, but its core operating profit fell by over 15% to £1.04bn.
Tesco’s core UK sales rose by 7.6%, but the response to the pandemic led to £533m in costs and its Tesco Bank business made a loss of £155m, with losses of up to £200m expected in that division for the full financial year.
Nevertheless, the grocery giant has declared an interim dividend of 3.2p per share for shareholders, 21% up on the 2.65p first-half award last year.
Tesco’s new group CEO, Corkman Ken Murphy said he was happy with the retailer’s strategy and direction after the interim figures were published.
“I think you can take it that I’m really happy with the strategy and direction of the company, unless you actually see it changing in the stores,” he said.
“As far as I’m concerned, my job is to maintain momentum in the business and keep us focused on delivering a brilliant Christmas,” he said.
Mr Murphy – formerly a senior executive with Boots pharmacy parent group Walgreens Boots Alliance – was unveiled as Tesco’s new CEO 12 months ago, but only formally took over from long-time boss Dave Lewis at the beginning of this month.
Mr Murphy also said he has no plans to further retreat Tesco’s presence from non-UK countries.
The group expects to complete the sale of its Thailand and Malaysia businesses this year and the sale of its Polish business next year.
“At this stage there is no plan for further retrenchment,” he said.
UK analysts still see major challenges ahead for Tesco, most notably the long-term impact of the Covid pandemic, a recession and disruption when Britain’s Brexit transition period finishes at the end of 2020.
Tesco last week briefly lost its position as Britain’s most valuable food retailer to online specialist Ocado.
- additional reporting Reuters
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