Concern at Tesco as sales slip 6.4%
Tesco Ireland’s market freefall continues, as the grocer reported like-for-like sales fell 6.4 per cent across its Irish network in the six months from February.
The parent company also reported a bigger-than-expected hole in its finances after finding accounting mistakes had gone back further than thought, forcing Britain and Ireland’s biggest grocer to scrap its full-year profit outlook. Tesco, once the unstoppable juggernaut of the retail sector, has lost half of its market value this year after the accounting mis-statement compounded earlier profit warnings.
Chief executive Dave Lewis said he could no longer provide a full-year profit forecast because he did not know the scale of Tesco’s problems or how much it would cost to rebuild the world’s third largest grocer.
The retailer’s Irish sales drop was expected. The firm, which employs 15,000 people across 146 stores and 22 petrol stations here, posted revenue for the period of ¤1.3 billion. Tesco Ireland’s chief executive Phil Clarke said: “Over the last six months we have improved our low prices through Price Promise, Staying Down and by accepting competitor coupons . . .”
With net debt rising, the pension deficit expanding and trading in its home market deteriorating at an alarming rate, the 95-year-old group said it was looking at all options to raise cash. Its shares fell 6 per cent to an 11-year low.