UK: Tesco Christmas sales helped by "stronger" clothing
- UK like-for-like sales, excluding VAT and petrol, grew by 1.8%
- Total UK sales rose 4.3% excluding petrol
- "Clothing enjoyed a stronger period"
Tesco says clothing enjoyed a stronger period over Christmas
UK like-for-like sales, excluding both VAT and petrol, grew by 1.8% in the six weeks to 5 January. Total UK sales grew by 4.2% including petrol and 4.3% excluding petrol.
Internationally, European sales declined by 0.6%, while in Asia, Tesco pointed to an improvement in like-for-like sales growth and total sales growth of 7.6%.
Group sales in the period increased by 3.8% including petrol and 3.9% excluding petrol.
Sales of general merchandise - which includes clothing and other non-food products - "was better than in the third quarter but was still a drag on our overall rate of growth, with more to be done on refocusing the business on sustainable, profitable categories in the coming year," the company said.
But it added: "Clothing enjoyed a stronger period - again, both in-store and online - on top of positive performances in the last two quarters."
Chief executive Philip Clarke noted: "The Group performed broadly in-line with our expectations through the Christmas period, with an improved performance in the UK and maintained trends elsewhere as we continue to experience tough trading conditions - particularly in Central Europe.
"Analysts, however, are yet to be convinced that Tesco is driving a sustainable turnaround.
George Scott, consultant at Conlumino, notes that while Tesco has reported its strongest rate of like-for-like growth in three years, and is beginning to show real signs of revival in its domestic market, "there's still a considerable way to go."
He adds: "Non-food as a whole continues to represent a weight around the neck of overall growth. The fundamental problem for Tesco in this area is that it continues to devote a high proportion of its overall store space to a non-food offer, which lacks inspiration.
"Moreover, in addition to more general underlying weakness in consumer demand in many of the non-food categories where it has gained strong presence, it is also contending with a relative influx of new non-food players.
"It will become increasingly important for Tesco to make fundamental improvements to its non-food offer.
And Kate Calvert at Seymour Pierce points out: "A year on from an effective profit warning, Tesco has had an unspectacular Christmas in the UK given last year's very weak comparables and material margin investment.
"There is still much to be done given general merchandise remains a drag and we believe there will be no visibility on whether UK profits have bottomed until the second half of 2013.
"With inflation coming back and too many of its international businesses also facing trading issues currently...we believe there is a high risk that things will get worse before they get better."
More than 200 companies have now signed the Accord on Fire and Building Safety in Bangladesh following the collapse of the Rana Plaza factory building in Dhaka, which killed more than 1,100 people in ...
Companies representing more than a third of UK clothing sales have signed the Sustainable Clothing Action Plan (SCAP) 2020 Commitment, a scheme that will see them work together to reduce the environme...
The most-read stories on just-style this week include continuing protests in Cambodia over the sacking of garment workers, the news that apparel pricing edged up in May, and Tesco's decision to stop s...
UK retail giant Tesco has stopped taking clothing from one of its supplier factories in Bangladesh after a structural survey of the site revealed serious safety issues....
Global brand management business Cherokee has seen its first-quarter profit fall by a fifth after one-off costs offset higher revenues....
Retail giant Tesco suffered mixed fortunes in its first quarter, with like-for-like sales in the UK falling despite a strong performance from clothing....
The UK government is putting pressure on clothing retailers that source from Bangladesh to improve the safety of their supply chains in the country. ...
- TPP: now the real fight starts
- Private label sourcing faces range of pressures
- Cambodia leads US apparel import growth in August
- Why TPP implementation is far from a done deal
- Can Gap maintain its momentum minus Larsson?
- Update: Negotiators agree landmark TPP trade deal
- Nike debuts new fabric for adaptive breathability
- New Bangladesh labour rules draw union criticism
- H&M falling behind on Bangladesh factory safety?
- Vietnam releases new textile dye regulations
- Wearable technology: The future market potential for smart garments and e-textiles
- Global Database of the Top 1000 Apparel Producers - Company Names, Financial Performance, and Contact Details
- Myanmar's Garment Sector in 2015 - now with updated members' directory
- Outdoor performance apparel: peaks, valleys, and green fields
- Global market review of lingerie - forecasts to 2020