The Irish branches of retailer Tesco recorded a sales turnover of £731 million (€870 million) in their latest quarter, following a rise of 4.4%, according to a recent business report published on Friday. This represents the fourth successive quarter that has seen an increase in volume, resulting in a further advancement in market share by 59 basis points.
Throughout this period, which ended on May 25th, there was sales expansion in every sector of the Irish operation. Food sales experienced a notable surge of 5.1%, with fresh produce sales exhibiting exceptional strength, underpinned by considerable investment in fresh products.
Tesco presented a broader picture, asserting that store and online customer expenditure is on the rise due to a lessening of food price inflation. This has contributed to the retailer’s largest market share growth in two years. It was also found that UK’s leading grocer, Tesco, had escalated comparable sales by 4.6%. For this fiscal year, Tesco is working towards achieving a retail operating profit of a minimum of £2.8 billion, maintaining its annual projection as it stood on Friday.
The retailer’s competitive pricing strategy has allowed it to encroach on the market shares of competitors, including Marks & Spencer and Waitrose, and to match prices with Aldi. London’s early trading saw Tesco’s shares rise 1.6%, marking an overall 16% uptick in the past year.
According to Tesco’s CEO, Ken Murphy, the recent relaxation in inflation has positively impacted sales volumes, helping Tesco maintain its standing as Britain’s cheapest major grocery retailer. Fresh produce and clothing were shown to be the top-selling items during this period. A mild ongoing improvement in customer sentiment was also noted by the CEO during a press briefing.
The CEO was also positive about the impact of the recent increases in the national minimum wage on its shoppers, projecting a modest single-digit inflation rate for the remainder of the year.
However, Tesco’s wholesale service, Booker, which supplies food to convenience retailers, catering businesses and restaurants, noted a 1.3% dip in sales, partially attributed to depleted tobacco sales. Despite these challenges, analyst William Woods from Bernstein endorsed the overall results from Tesco, asserting them as proof of the retailer’s continued thriving presence in the UK market.