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Trading statements

Tesco reports group LFL sales growth of 1.0% in Q1

16 June 2017 07:14

Tesco said its group like-for-like (LFL) sales rose 1.0% in Q1, with UK LFL sales up 2.3% thanks to a strong showing by food as international sales dropped 3% as unprofitable bulk-selling products were dropped in Thailand.

CEO Dave Lewis noted tough market conditions and work with supplier partners to keep prices low.

"Customers have responded by doing more of their shopping with us and as a result we continue to grow volumes, particularly in fresh food.

"This is a good start to the year, with our sixth consecutive quarter of positive like-for-like sales growth across the Group.

"We are confident in our plans to create long-term, sustainable value for our key stakeholders and to deliver on the ambitions we have set out."

Tesco said it continued to implement plans to reduce its cost base by £1.5bn.

International like-for-like sales were down 3.0% in Q1, predominantly due to a 2.7% impact from discontinuing unprofitable bulk selling of products - particularly tobacco and alcohol - in Thailand.

"This reflects a decision to simplify the business around our core retail offer, ensuring we focus on sustainable, profitable sales growth," the company said.

"We saw a small improvement in performance in Europe, driven by strong growth in the Czech Republic and Slovakia. Ongoing productivity savings have enabled us to continue to reinvest in our core offer across the region."

Tesco Bank continued to deliver a simple and accessible product offer for Tesco customers. Sales increased by 4.8% in the quarter, supported by a significant increase in secured lending following the launch into the intermediary mortgage broker market in April 2016.

Story provided by StockMarketWire.com

Related Company: TSCO

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