SUPERMARKET GIANT TESCO has reported a decline in like-for-like sales excluding petrol of 1.3 per cent for the third quarter of 2012.
The company said its group sales for the thirteen weeks ending 24 November 2012 increased by 2.4 per cent including petrol. Sales in Ireland only saw a fall of 0.3 per cent in the three month period compared to a growth of 0.2 per cent in the second quarter of 2012.
Sales in the food business, the company’s main focus, has improved to 1.2 per cent for the quarter, outperforming the market.
Tesco said it was pleased with its online grocery business which delivered sales growth of 15 per cent in the three month period.
The company said the reduction in like-for-like sales has led to a greater drag on the overall UK performance in the quarter.
“While this partly reflects the continuing weakness in consumer demand that is being experienced by the market as a whole, we are renewing our efforts to deliver sustainable, profitable growth in this part of the business,” it said.
Tesco said efforts will include stronger ranging, pricing and promotional positioning, together with a further reallocation of space away from categories such as consumer electronics and home entertainment.
Total sales in Asia grew by 5.1 per cent at actual exchange rates and total sales in Europe excluding petrol grew by 1.1 per cent at constant exchange rates.
Today the company also announced a strategic review of Fresh & Easy and said Tim Macon, CEO of the US chain would leave Tesco after 30 years with the company.
Tesco said it is now clear that Fresh & Easy will not deliver acceptable shareholder returns on an appropriate timeframe in its current form.
They company has therefore appointed Greenhill to assist with the review of options.
Commenting on the announcement today, CEO of Tesco Philip Clarke said, “Whilst the business has many positives, its journey to scale and acceptable returns will take too long relative to other opportunities.”
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