Tesco, the UK’s largest retailer, saw its share price slide this morning (3 October) after booking a decline in first-half profit.
A slowdown in sales in the UK hit the retail giant’s earnings in the six months ended 25 August with pre-tax profit sliding 11.6% to GBP1.66bn (US$2.68bn).
The decline was largely due to spending on the retailer’s GBP1bn investment programme to turnaround its domestic business, announced by chief executive Philip Clarke in April.
In the UK, trading profit was down 12.4% to GBP1.12bn, with like-for-like sales down 0.7%.
Clarke said trading conditions “continued to be tough” across the whole of the UK market in the first half, with consumer confidence remaining at “very low levels”.
International profits also declined in the period, down 17.1% to GBP378m.
Group operating profit slid 6.6% to GBP1.81bn.
Sales, however, edged up 1.6% to GBP32.31bn in the period, but like-for-like sales, excluding petrol, were down 0.6%.
Tesco’s share price was down 1.01% at 333.25 pence at 10:19 GMT.
Click here to read Tesco’s views on its efforts to improve its domestic performance.