Tesco has said that sales at its home UK operations were up 0.9% for full year 2016/17, its first full year of growth since 2009/10. However, group profit before tax was £145 million, a 28% decline year on year.
Tesco posted a 1.3% increase in like-for-like food sales in the UK for the year, driven in particular by the performance of its ‘Farm Brands’ own-brand range, which now feature in 64% of consumer baskets, the retailer said.
In addition, Tesco said that it has invested in ‘clearer, simpler’ pricing - a typical customer basket is 6% cheaper than it was in September 2014, while it has reduced the quantity of multi buy promotions it offers by 24%.
Group Sales
Group sales at the retail giant were up 4.3% to £49.9 billion for the year, with group operating profit before exceptional items up 30% to £1.28 billion, the retailer said.
Sales in its Republic of Ireland operation were down marginally (-0.1%) for the year, while International sales were up 1.3%.
It has also generated cost savings of £226 billion towards a £1.5 billion medium-term target, including full-year savings of £455 million.
Stronger Offering
“Today, our prices are lower, our range is simpler and our service and availability have never been better,” said chief executive Dave Lewis. “Our exclusive fresh food brands have strengthened our value proposition and our food quality perception is at its highest level for five years. At the same time, we have increased profits, generated more cash and significantly reduced debt.
“We are ahead of where we expected to be at this stage, having made good progress on all six of the strategic drivers we shared in October. We are confident that we can build on this strong performance in the year ahead, making further progress towards our medium-term ambitions.”
Lewis also commented on the group’s forthcoming merger with Booker, which he said will bring together “two complementary businesses, driving additional value for shareholders by realising substantial synergies and enabling us to access the faster growing ‘out of home’ food market.”
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
