Britain's largest retailer Tesco has reported a 6% fall in group annual profit, as it continues to struggle both home and abroad, particularly to emerging discounters.
It is the second consecutive year in which the supermarket giant has announced falling profits.
The world's third-largest retailer said group trading profit for the year to 22 February was £3.3 billion, in line with analysts' forecasts of £3.24 billion but down on the £3.45 billion posted in 2012-13.
However, the results are better than some analysts' expectations of a 10% fall to £3 billion.
Tesco announced that its European business decreased in value by £734 million, in the wake of the financial crisis.
Group trading profit in Europe fell 28% to £238 million, as the company reported sales dips in Ireland, Turkey, Hungary, Slovakia, Poland and the Czech Republic.
Its Asian business also took a considerable hit, with profit down 5.6% to £692 million.
The company said that sales at stores open over a year in the UK, excluding VAT and fuel, dropped 3% in its fourth quarter. This is the sharpest quarterly fall in sales since chief executive Phillip Clarke was appointed three years ago.
"Our results today reflect the challenges we face in a trading environment which is changing more rapidly than ever before," said Clarke in a statement accompanying the annual results this morning.
Clarke is in the midst of a £1 billion-turnaround plan which was launched in the face of last year’s first fall in group profits in nearly 20 years.
Latest industry figures showed that Tesco's UK market share fell to 28.6% in the 12 weeks to March 31, from 29.7% a year earlier.
Both Tesco's share price and market share are faltering, approaching near-decade lows.
Like the UK’s three other leading grocers - Wal-Mart’s Asda, Sainsbury’s and Morrisons - Tesco has been squeezed between hard discounters Aldi and Lidl and upmarket grocer Waitrose.
© 2014 - European Supermarket Magazine by Enda Dowling
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