Tesco ‘disappointed’ by Christmas trading
Tesco has reported its worst Christmas in decades after seeing a 2.3% drop in sales, excluding VAT and fuel, in the six weeks to 7 January.
The retailer said the results for the period were “below expectations and disappointing” and warned it would see “minimal” profit growth this year.
The decline was largely driven by food sales.
Philip Clarke, chief executive, said: “We will continue the process of change that we started nine months ago to address long-standing business issues, building on the important steps we have already taken in the US, in Japan and at Tesco Bank, as well as those we have begun to take in the UK.”
The retailer said the Big Price Drop campaign was a important first element in this process but there was much more it could do to further improve the shopping trip for its customers.
Looking ahead, Clarke said: “In a challenging consumer environment at home, and with early signs of more cautious behaviour emerging elsewhere, we have seen more strain than anticipated on our profitability during the important seasonal trading period.
“As a result, while underlying profit before tax and earnings per share for 2011/12 will be broadly in line with market consensus forecasts, we expect group trading profit growth to be around the low end of the current consensus range.”
