Tesco logs subdued quarterly sales

People walk past a Tesco Extra store in Woolwich, southeast London February 26, 2016. — Reuters pic
People walk past a Tesco Extra store in Woolwich, southeast London February 26, 2016. — Reuters pic

LONDON, June 13 — Britain’s biggest retailer Tesco today posted subdued sales for the first quarter of its financial year, citing poor consumer sentiment in its Brexit-facing home market.

Sales rose 0.4 per cent to £14 billion (RM74 billion) in the three months to May 25 from a year earlier, Tesco said in a trading update.

In Britain, sales fell 0.4 per cent in the first quarter but rose 0.4 per cent on a like-for-like basis — which strips out the impact of new floor space.

The same period of the company’s previous financial year had been boosted by a royal wedding and hot weather conditions.

However, recent volatile weather has impacted sales of seasonal products, such as clothing, according to Tesco.

“There’s some weakness in consumer sentiment in the UK,” said chief executive Dave Lewis.

“Clearly part of that is down to the political situation,” he added in reference to ongoing Brexit uncertainty.

“The other element is the weather.”

In recent years, traditional British supermarkets have also come under fierce pressure from German discounters Aldi and Lidl, forcing them to become more competitive on pricing of food and household items.

Lidl yesterday said it will open more than 40 new stores in and around London over the next five years, creating 1,500 jobs. — AFP