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Retail

Sales Fall At Tesco Amid "Challenging" Q3

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Sales Fall At Tesco Amid "Challenging" Q3

Tesco has said “continuing pressures” on household finances led to a drop in sales in its home market for its third quarter, compounding a fall in sales in all its other markets around the world.

The decline marks almost two years since Tesco issued its first profit warning in two decades and the grocery giant has yet to turn itself around.

In the UK, total sales were up 0.9% (excl. petrol), but like for like sales declined by 1.5% in what they describe a “weaker grocery market”.

Like for like sales in the 13 week period to 23 November were down 2.5% internationally, while overall sales (excluding petrol) were up 0.6%. 

Their global strategy for recovery has been closely watched, selling out of Japan and the US while taking a partner in China. Yet remaining markets in Asia and Europe in which it operates are in decline by 5.1% and 4%, respectively, on a same-store basis.

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Bruno Monteye, who is a senior analyst for the Wall Street sell-side research firm Bernstein, said that he "expects that Tesco's current strategy will fail to turn around the UK's fortunes".

Bernstein note that Tesco are losing market share to both discounters (Aldi, Lidl) and quality retailers (Waitrose, Sainsbury's) in the UK because of its "continued problem of having an undifferentiated offer".

Chief Executive Philip Clarke said in a statement issued this morning that "continuing pressures on UK household finances have made the grocery market more challenging for everyone since the summer and our third quarter performance reflects this."

© 2013 - European Supermarket Magazine by Enda Dowling

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