Tesco Christmas trading disrupted by wintery weather in UK

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Tesco: non-food sales at larger stores hit at Christmas

Tesco blamed serve winter weather conditions in the run up to Christmas for a disappointing 0.6% increase in like-for-like sales in the UK in the six weeks to 8 January 2011.

Non-food, in particular, was hit as customers struggled to travel to Tesco’s larger, out of town stores. Coupled with strong comparisons in 2009, non-food growth was subdued, said Tesco.

In food, Tesco said it delivered a strong like-for-like sales performance, with double-digit growth in its premium own label range, Finest, driven by a strong seasonal offer.

Online, Tesco said sales were strong in food and non-food with double-digit total online sales growth.

Tesco Direct had sales growth of 18%, with a strong performance in toys, gaming and small domestic appliances; while Tesco Mobile reached a new record over Christmas, growing to more than 2.5m customers.

Group sales in the six weeks to 8 January 2011 increased by 7.6%, excluding petrol, with total international sales up 14.2%.

In Asia, total sales grew by 24.2%, with like-for-like sales growth driven by Thailand and China.

In Europe, total sales grew by 5.6%. Tesco said like-for-like sales growth was positive in every country and similar overall to its third quarter performance.

In the US, Tesco said Fresh & Easy continues to perform well and was helped by a successful Christmas and New Year period. Total sales grew by 36.9% and like-for-like sales growth is reported to have remained strong.

Terry Leahy, chief executive, said: “The Group has continued to make good progress, helped by strong growth across our international businesses, which delivered over half of the Group’s growth.

“Our performance remains solid but was hindered in the run up to the important Christmas trading period in the UK by the disruptive effects of the severe winter weather conditions. Our staff and suppliers did a fantastic job in delivering a great shopping trip for customers in difficult circumstances.”