Tesco sales fall again amid alert on its £1bn push

 

Tesco has posted its fourth consecutive quarter of falling UK underlying sales, prompting analysts to warn its £1bn investment plan to turn around its domestic trading could be a "marathon".

However, the UK's biggest grocer said its first-quarter performance would have been "substantially better" had it included the build-up to the Diamond Jubilee, which was its "biggest ever week" outside Christmas.

Tesco, the world's third-biggest retailer, posted a 1.5 per cent fall in UK sales, excluding fuel and VAT, for the 13 weeks to 26 May.

This was in line with City expectations and represents a slight improvement on the 1.6 per cent drop in its fourth quarter. City analysts were also relieved there was no change to full-year guidance, following its first profit warning in 20 years in January.

Nevertheless, the weak performance from Tesco will ratchet up the pressure on Philip Clarke, who took the helm in March 2011, and its latest trading will contrast unfavourably to Sainsbury's results tomorrow. The UK's third-biggest supermarket is expected to deliver a 1.6 per cent rise in like-for-like sales, although its trading period covering the Jubilee bank holiday.

Mr Clarke put a brave face on Tesco's UK results by stressing it had so far spent "very little" of its £1bn investment plan that covers hiring 8,000 extra store staff this year, increased training and sprucing up its stores. He said: "I can see momentum gathering."

Richard Hunter, the head of equities at Lansdown Stockbrokers, said: "Realistically, this is a marathon and not a sprint for Tesco. The amendment to its business model will take time to implement and wash through."

Mr Clarke cited a "great response" to the launch of its Everyday Value range, which replaced its existing Value range, in the spring and said it had trained and put 4,300 additional staff into 700 of its Extra hypermarkets and Superstores.

Tesco delivered more than £1bn of sales in the run-up to the Jubilee. Group sales at Tesco, which has operations in 14 countries, rose by 2.2 per cent. The Fresh & Easy operation in the US disappointed with sales up by just 3.6 per cent.

Start your day with The Independent, sign up for daily news emails
News
i100 In this video, the late actor Leonard Nimoy explains how he decided to use the gesture for his character
Arts and Entertainment
Secrets of JK Rowling's Harry Potter workings have been revealed in a new bibliography
arts + ents
News
Down-to-earth: Winstone isn't one for considering his 'legacy'
people
News
news
ebooks
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: HR Benefits Manager

£40000 - £50000 per annum + pro rata: SThree: SThree Group have been well esta...

Recruitment Genius: Office Manager / Financial Services

£30000 - £37000 per annum: Recruitment Genius: Established in 1999, a highly r...

Jemma Gent: Year End Accountant

£250-£300 Day Rate: Jemma Gent: Are you a qualified accountant with strong exp...

Jemma Gent: Management Accountant

£230 - £260 Day Rate: Jemma Gent: Do you want to stamp your footprint in histo...

Day In a Page

HIV pill: Scientists hail discovery of 'game-changer' that cuts the risk of infection among gay men by 86%

Scientists hail daily pill that protects against HIV infection

Breakthrough in battle against global scourge – but will the NHS pay for it?
How we must adjust our lifestyles to nature: Welcome to the 'Anthropocene', the human epoch

Time to play God

Welcome to the 'Anthropocene', the human epoch where we may need to redefine nature itself
MacGyver returns, but with a difference: Handyman hero of classic 1980s TV series to be recast as a woman

MacGyver returns, but with a difference

Handyman hero of classic 1980s TV series to be recast as a woman
Tunnel renaissance: Why cities are hiding roads down in the ground

Tunnel renaissance

Why cities are hiding roads underground
'Backstreet Boys - Show 'Em What You're Made Of': An affectionate look at five middle-aged men

Boys to men

The Backstreet Boys might be middle-aged, married and have dodgy knees, but a heartfelt documentary reveals they’re not going gently into pop’s good night
Crufts 2015: Should foreign dogs be allowed to compete?

Crufts 2015

Should foreign dogs be allowed to compete?
10 best projectors

How to make your home cinema more cinematic: 10 best projectors

Want to recreate the big-screen experience in your sitting room? IndyBest sizes up gadgets to form your film-watching
Manchester City 1 Barcelona 2 player ratings: Luis Suarez? Lionel Messi? Joe Hart? Who was the star man?

Manchester City vs Barcelona player ratings

Luis Suarez? Lionel Messi? Joe Hart? Who was the star man at the Etihad?
Arsenal vs Monaco: Monaco - the making of Gunners' manager Arsene Wenger

Monaco: the making of Wenger

Jack Pitt-Brooke speaks to former players and learns the Frenchman’s man-management has always been one of his best skills
Cricket World Cup 2015: Chris Gayle - the West Indies' enigma lives up to his reputation

Chris Gayle: The West Indies' enigma

Some said the game's eternal rebel was washed up. As ever, he proved he writes the scripts by producing a blistering World Cup innings
In Ukraine a dark world of hybrid warfare and murky loyalties prevails

In Ukraine a dark world of hybrid warfare

This war in the shadows has been going on since the fall of Mr Yanukovych
'Birdman' and 'Bullets Over Broadway': Homage or plagiarism?

Homage or plagiarism?

'Birdman' shares much DNA with Woody Allen's 'Bullets Over Broadway'
Broadchurch ends as damp squib not even David Tennant can revive

A damp squib not even David Tennant can revive

Broadchurch, Series 2 finale, review
A Koi carp breeding pond, wall-mounted iPads and a bathroom with a 'wellness' shower: inside the mansion of Germany's 'Bishop of Bling'

Inside the mansion of Germany's 'Bishop of Bling'

A Koi carp breeding pond, wall-mounted iPads and a bathroom with a 'wellness' shower