Solid Tesco driven by international expansion

Tesco has delivered a strong performance and record sales over the Christmas and New Year period, with a solid UK results backed up by excellent international sales expansion.

In the six weeks to 5 January 2008, total UK sales grew by eight per cent, comprising like-for-like growth of 5.1 per cent and 2.9 per cent from net new space. Like-for-like sales excluding petrol, the yardstick used to measure Tesco’s rivals over the last seven days, increased by a satisfactory 3.1 per cent in the period, below analysts expectations.

Tesco finance director Andrew Higginson told BBC radio: "It was a great Christmas for customers, we did a terrific job in the stores in terms of availability, and you know, it was a profitable Christmas for us.

"Overall we're thrilled to bits, particularly given how some of the other retailers' results have come out."

Tesco’s trading statement said: “The Tesco team delivered an even better shopping trip for customers than last year and a profitable seasonal period for the business - by providing high standards of service and availability whilst meeting the challenges posed by having two short trading days immediately before Christmas.”

Group sales increased by 12.8 per cent, a faster rate of growth than in Tesco’s third quarter overall.

The statement said: “Our overseas businesses traded well over the Christmas and New Year period, with International sales growing by 26.9 per cent, with strong growth in both Europe and Asia.

“In Central Europe we saw sales growth of almost 30 per cent and in some of our newer countries we saw exceptionally good progress - with, for example, Turkey growing by more than 80 per cent and Malaysia by more than 60 per cent.

“In the US, the early customer response to Fresh & Easy has been very encouraging. We now have 28 stores trading in Southern California, Las Vegas and Phoenix.”

The group’s on-line businesses, tesco.com and Tesco Direct, had a very successful Christmas. Total sales were up by 24 per cent to over £190 million with well over 2m orders delivered in the six weeks.