14th Jun 2024 08:40
(Alliance News) - Tesco PLC on Friday said it continued to pick up market share and grow volumes leaving the business "well-positioned" for the months ahead.
The grocer said like-for-like sales in the 13 weeks to May 25, the financial first quarter, rose 3.4% to GBP15.31 billion. The UK outperformed with comparable sales up 4.6% to GBP11.4 billion. Booker sales fell 1.3%, Central Europe sales rose 0.6% while in the Republic of Ireland sales climbed 4.4%.
Chief Executive Ken Murphy said: "Following another strong quarter, we're pleased to reiterate our guidance for the full year, with sales trends in line with our expectations and the business well-positioned for the months ahead."
Shares in the Welwyn Garden City-based retailer rose 1.4% to 306.60 pence in London on Friday morning.
Murphy highlighted "strong volume growth across the UK, Republic of Ireland and Central Europe supported by easing inflation."
In the UK, Tesco said food sales rose 5.0%, including strong volume growth across the quarter, particularly in fresh food, while non-food sales rose 0.7%, driven by strong growth in clothing.
Online sales rose 8.9% driven by volume growth and strong contribution from Tesco's food delivery service, Whoosh.
Sales of Tesco's premium own brand Finest range rose 13%.
Tesco said its market share was growing ahead of all key competitors, up 52 basis points to 27.6%, citing data from Kantar.
"We continue to be the cheapest full-line grocer and are the most competitive we've ever been, with our value, product quality and service driving better brand perception and customer satisfaction. Our market share reflects this, growing more than at any other time in the past two years, with customers switching to us from other retailers, shopping with us more often and with more in their baskets," Murphy said.
The sales fall at Booker reflected continued tobacco market decline and weakness in parts of the fast-food market serviced by Best Food Logistics. It also reflects the strength of prior year comparatives, Tesco noted.
For financial 2025, Tesco expects retail adjusted operating profit of at least GBP2.8 billion, compared to GBP2.76 billion in financial 2024, and to generate retail free cash flow within the guidance range of GBP1.4 billion to GBP1.8 billion, down at least 13% from GBP2.06 billion in financial 2024.
By Jeremy Cutler, Alliance News reporter
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