Sales improving at supermarket giant Tesco

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The Independent Online

Supermarket giant Tesco reported an improving trend in UK sales today but warned that high fuel costs continue to divert customer spending from the tills.

The UK's largest supermarket posted a 0.1% drop in same-store sales excluding fuel and VAT in the 13 weeks to May 28, up from a 0.7% fall in the previous quarter. Total UK sales including fuel and VAT were up 7%.

Food sales performed well, with meat, fish and poultry recording good UK growth, but this was overshadowed by declines and weak demand in non-food areas, Tesco said.

The company's fast-growing Asian business continued to offset weak domestic demand, posting 3.2% like-for-like sales growth, driven by a strong show in Thailand. Total group sales including fuel were up 7.8%.