Con­cern at Tesco as sales slip 6.4%

The Irish Times - Friday - The Ticket - - BUSINESS NEWS -

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.

Ir­ish mar­ket

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.

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