Tesco this morning (15 June) posted a mixed trading update, citing “good progress” in its overseas markets – despite flat sales – and seeing UK sales stagnate.
The UK’s largest retailer was upbeat about the “longer-term trends” from its international business despite reporting “broadly flat” like-for-like sales overseas for the 13 weeks to 30 May.
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Continued recovery in Ireland pushed Tesco’s like-for-likes in Europe into positive territory.
However, like-for-like sales in Asia were “held back temporarily” by political uncertainty in South Korea and Thailand, Tesco said.
“The longer-term trends in our international business remain encouraging as the global recovery takes hold. Although a number of short-term factors have impacted certain markets this quarter, the underlying direction of improving performance remains,” Tesco said.
Including the impact from new stores, Tesco’s international sales rose by 5.3% on a constant-currency basis.
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By GlobalDataIn the UK, Tesco’s total sales – including VAT and petrol – grew by 6.5%. Group sales, from overseas and the UK, were up 8.2%
However, Tesco said UK consumers, facing higher fuel costs, had to “shift some of their spending to petrol at the expense of their normal shopping”.
More expensive fuel, plus low food inflation, meant Tesco’s like-for-like sales, excluding petrol, was up a mere 0.1%, VAT-adjusted.
Tesco’s shares were also up 0.1% at 392p at 09:14 BST after dipping in early trading.
