Tesco’s confidence in its new discounter range received a serious boost this week as interim results showed 30% sales growth in central Europe.
The sales figures proved Tesco really was “the biggest discounter”, said CEO Sir Terry Leahy. He praised the success of the range, which was launched two weeks ago in the UK to rival stores such as Aldi and Lidl.
“The discounter range was developed for central Europe, because people are more familiar with discount retailers there. Year-on-year growth of the range is 30% – and if you add the new products it’s 70% up. Overall sales are around £30m, which is more than Aldi, and we’re extending the UK range this week.”
The 350-product rang had received good feedback from UK customers, who liked the Daisy household goods and the Market Value produce and poultry range, Sir Terry said. Tesco reported “excellent progress” for Tesco internationally, but admitted when it announced its half-year results that it faced problems in the UK.
Underlying pre-tax profit was up 11.3% on the previous year to £1.43bn in the 26 weeks to 23 August and group sales increased 14.1%, Tesco reported. International sales increased 26.8% in the period, while sales in the UK rose 9.7% to £20.1bn. Excluding petrol, like-for-like sales were up 3.7% in UK stores.
In the US, where Tesco’s 90 Fresh & Easy stores did not get off to the best start, sales reached £76m in the first half of the year to 23 August but it made trading losses of £60m.
“The discounter range was developed for central Europe, because people are more familiar with discount retailers there. Year-on-year growth of the range is 30% – and if you add the new products it’s 70% up. Overall sales are around £30m, which is more than Aldi, and we’re extending the UK range this week.”
The 350-product rang had received good feedback from UK customers, who liked the Daisy household goods and the Market Value produce and poultry range, Sir Terry said. Tesco reported “excellent progress” for Tesco internationally, but admitted when it announced its half-year results that it faced problems in the UK.
Underlying pre-tax profit was up 11.3% on the previous year to £1.43bn in the 26 weeks to 23 August and group sales increased 14.1%, Tesco reported. International sales increased 26.8% in the period, while sales in the UK rose 9.7% to £20.1bn. Excluding petrol, like-for-like sales were up 3.7% in UK stores.
In the US, where Tesco’s 90 Fresh & Easy stores did not get off to the best start, sales reached £76m in the first half of the year to 23 August but it made trading losses of £60m.
Tesco’s US start-up costs don’t look so bad compared with spiralling UK costs:
£70m cost of UK fuel hike £60m trading losses at Fresh & Easy
£70m cost of UK fuel hike £60m trading losses at Fresh & Easy
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