Delivering its Christmas trading update today (16 January), Tesco revealed expectation-beating Christmas sales, which were boosted by premium, online and non-food sales.


Underlying sales at the UK’s largest grocer were up 5.9% for the six weeks to 6 January, with online sales increasing by 30% to over GBP150m (US$294.8m). Sales of organic food increased by 39% during the period, while Tesco’s premium own-brand Finest meat and poultry sales rose 55%, highlighting consumers’ growing willingness to spend more on products perceived to offer high quality.


Group sales, excluding petrol, rose by 9.9% while like-for-like revenue in the UK increased by 5.4%, and 2.9% from new stores. During the first half of the year, Tesco opened 36 of its Express convenience stores.


Last week, Morrisons reported a better-than-expected 6.3% increase in Christmas trading while Sainsbury’s posted revenue growth of 5%.


Tesco is expected to implement over 200 price cuts in the near future in an attempt to bring competition back to price. In this morning’s trading statement, the retailer said that price inflation in the UK rose by 0.1%. Sainsbury’s had reported an inflation rise of 1.7%.

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Non-food items performed well and internationally trading in the six weeks rose by 15.8% despite political troubles in Thailand, Tesco’s largest overseas market.


Tesco shares were marginally up at time of press, increasing 0.32% to GBP4.2108.

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